BANCROFT    LIBRAJPCf 


REPORT 


ON  THE 


.abor  Laws  and  Labor  Conditions 


OF  FOREIGN  COUNTRIES 


In  Relation  to  Strikes  and  Lockouts 


Prepared  for  the  information  of  His  Excellency 
GOVERNOR  JAMES  N.  GILLETT 


BY 


HARRIS  WEINSTOCK 

Special  Labor  Commissioner 


SACRAMENTO: 

W.  W.  SHANNON,       :       :       :       :      SUPERINTENDENT  STATE  PRINTING 

1910. 


u.  c. 

5ADEMY    OF 
CIFIC  COAST 
HISTORY 


Bancroft  Library 


CONTENTS. 


PAGE. 

LETTER  OF  TRAXSMITTAL   5 

REPORT  ON  LABOR  LAWS  AM)  LABOR  CONDITIONS  OF  FOREIGN 

COUNTRIES    7 

ITALY    7 

RUSSIA    13 

AUSTRIA    19 

GERMANY IT, 

BELGIUM :;:: 

FRANCE :•>!) 

ENGLAND    Hi 

VICTORIA.  AUSTRALIA   .' H7 

NEW  SOUTH  WALKS.  AUSTRALIA   74 

AUSTRALIA 90 

NEW  ZEALAND    : Its 

CONCLUSIONS  AND  RECOMMENDATIONS  .  14.'. 


LETTER  OE  TRANSMITTAL. 


To  His  Excellency,  GOVERNOR  JAMES  N.  GILLETT, 
State  Capitol,  Sacramento,  Cal. 

DEAR  SIR  :  I  have  the  honor  to  hand  you  herewith  my  report  in  the 
execution  of  the  commission  I  hold  from  you  as  Special  Labor  Com- 
missioner to  examine  into  the  labor  conditions  and  labor  laws  of  foreign 
countries,  and  to  report  thereon  to  you,  the  Executive  of  the  State  of 
California. 

I  have,  during  the  past  fifteen  months,  visited  Italy,  Russia,  Austria, 
Germany,  Belgium,  France,  England,  the  British  Colonial  States  of 
Victoria,  and  New  South  Wales,  in  the  Commonwealth  of  Australia,  and 
the  Dominion  of  New  Zealand,  and  have  investigated  their  labor  laws 

and  labor  conditions. 

I  have  now  the  honor  to  submit  this  as  my  report  covering  these 

various  investigations,  and  to  embody  in  a  final  chapter  such  general 
conclusions  as  I  have  been  enabled  to  reach,  and  such  recommendations 
for  proposed  legislation  as  in  my  opinion  is  likely  to  lessen  strikes  and 
lockouts  in  the  Commonwealth  of  California. 
Eespectfully  yours, 

HARRIS  WEINSTOCK. 
January  10,  1910. 


REPORT  ON 

LABOR  LAWS  AND  LABOR  CONDITIONS 

OF  FOREIGN  COUNTRIES. 


ITALY. 


In  my  investigations  of  the  labor  laws  and  the  labor  conditions  of 
Italy,  I  find  from  inquiries  made  of  Dr.  Marchetti  of  the  Government 
Labor  Bureau,  which  is  a  branch  of  the  Ministry  of  Agriculture,  Manu- 
factures and  Commerce,  that  labor  legislation  in  Italy  is  much  occupied 
just  now  with  the  problem  of  legalizing  and  regulating  collective 
"bargaining  as  between  associations  of  workers  and  associations  of 
employers,  more  especially  in  its  bearings  on  agricultural  labor  con- 
tracts, agricultural  labor  having  attained  a  high  degree  of  organization 
in  Italy,  the  unions  numbering  270,000  members,  plus  sixty  or  seventy 
thousand  organized  outside  the  federation.  In  the  National  Council 
of  Labor,  on  which  the  government  is  represented,  there  is  a  strong 
current  in  favor  of  introducing  into  such  collective  bargaining  a  clause 
enforcing  compulsory  arbitration  in  labor  disputes,  but  su?h  a  measure 
requires  careful  study  before  being  concreted,  as  there  is  strong  oppo- 
sition to  it,  especially  on  the  part  of  the  workers  themselves,  who  think 
their  interests  are  better  safeguarded  by  avoiding  all  such  compulsory 
intervention. 

Three  private  bills  will  be  brought  into  the  House  of  Deputies  by  the 
lions.  Bissolati,  Nicolini,  and  Alessio,  in  favor  of  a  lawr  for  compulsory 
arbitration,  and  the  government  has  promised  to  study  them  and 
incorporate  the  principle  in  a  measure  of  its  own  initiative;  but  it  is 
easy  to  foresee  that  months,  if  not  years,  will  have  to  pass  before  such 
a  project  is  concreted.  There  already  exists  in  most  trades  permanent 
arbitration  bodies,  known  here  as  "Probiviri,"  chosen  half  amongst 
the  workers  and  half  amongst  the  employers,  elected  at  fixed  intervals, 
generally  every  two  years,  to  whom  disputes  arising  as  to  the  interpre- 
tation of  a  contract  can,  if  desired,  be  submitted  both  by  masters  and 
men,  and  it  is  proposed  to  extend  such  boards.  Avhose  awards  are  taken 


8  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

into  consideration  by  the  courts  should  the  dispute  be  carried  into  them, 
to  agricultural  labor. 

UNIONISM. 

It  would  seem  that  unionism  is  a  comparatively  young  movement  in 
Italy,  the  first  labor  unions  and  Chambers  of  Labor  (Camere  di  Lavoro) 
having  been  formed  in  industrial  centers  in  1892,  though  they  only 
assumed  real  importance  after  the  great  labor  and  political  difficulties 
of  1898.  The  organization  of  the  peasantry  into  leagues  of  resistance 
is  still  more  recent,  dating  back  only  to  1901,  when  it  started  in  the 
province  of  Mantua  after  an  unusual  outbreak  of  strikes  and  lockouts 
in  rural  districts.  The  movement  was  started  and  directed  by  the 
Socialist  leaders  and  is  still  almost  entirely  in  their  hands,  though  in 
Komagna  some  strong  organizations  are  in  the  hands  of  the  Republican 
party.  These  organizations  differ  widely  in  different  provinces  in  their 
aims  and  methods.  In  many  parts  they  aim  at  regulating  the  phenom- 
enon of  the  internal  emigration  of  farm  laborers  from  one  province  to 
another,  which  has  assumed  very  large  proportions  in  Italy.  In  other 
regions,  and  more  especially  in  Emilia,  such  organization  takes  the  form 
of  the  collective  leasing  of  farms  which  are  exploited  on  a  cooperative 
basis;  this  feature  has  attained  great  developments  and  yielded  many 
interesting  and  valuable  results.  Since  the  creation  of  the  agricultural 
unions,  which  have  given  rise  to  many  big  and  closely  contested  strikes, 
there  has  been  a  marked  advance  in  the  wages  paid  to  farm  hands, 
raising  them  in  some  districts  from  thirteen  cents  per  day  to  sixty-five, 
or  a  gain  of  about  five  hundred  per  cent,  and  nearly  everywhere  the 
pay  has  nearly  or  more  than  doubled,  but  it  is  not  even  claimed  by  the 
unionists  that  this  marked  difference  is  wholly  due  to  organization. 
In  many  r%ions,  notably  in  the  southern  provinces,  emigration  is 
mainly  responsible,  as  labor  has  become  very  scarce  and  can  command 
its  own  price ;  in  other  parts  where  the  emigration  phenomenon  has  not 
made  itself  felt,  factors  have  been  the  high  degree  of  prosperity  which 
has  prevailed  in  Italy  as  elsewhere  for  the  last  few  years,  the  higher 
price  commanded  by  many  products,  migrations  to  cities,  due  to  the 
increased  industrial  activities,  and  the  general  increase  in  the  cost  of 
living  due  to  the  diminished  purchasing  power  of  money.  The  oppo- 
nents of  unionism  indeed  maintain  that  there  is  little  relation  between 
the  growth  of  unionism  and  the  increase  of  wages  other  than  that  of 
coincidence,  but  it  is  generally  admitted  that  unionism  has  had  its  share 
in  raising  the  standard  of  living. 

The  statistics  published  by  the  Labor  Bureau  show  that  unionism  has 
not  had  much  influence  on  the  length  of  the  working  day,  though  in 
some  places  it  has  brought  about  this  change:  That  pay,  instead  of 
being  by  the  day  as  formerly,  is  by  the  hour,  which  has  tended  to  put 


ITALY.  9 

a  premium  on  long  rather  than  on  short  hours,  due  to  the  desire  of  the 
workers  to  make  a  large  wage.  Many  farm  laborers  work  as  many  as 
fourteen  hours  a  day  in  the  busy  season  in  those  regions  where  they 
live  on  the  fields  they  till ;  in  other  provinces  the  working  day  is  of  nine 
and  one  half  hours,  as  the  laborers  live  in  villages  often  at  a  consid- 
erable distance  from  their  work,  and  the  difference  of  time  is  largely 
taken  in  going  to  and  from  their  homes. 

LABOR  SAVING  DEVICES. 

The  increased  cost  of  farm  labor  has  tended  to  promote  the  intro- 
duction of  better  methods  of  farming,  als  the  landowner  has  had  to 
have  recourse  to  this  means  of  increasing  the  yield  of  his  land  as  an 
offset  to  the  larger  slice  now  given  to  labor.  So  far  as  conditions 
permit  labor  saving  devices  are  being  introduced,  and  this  without,  as 
a  rule,  exciting  the  opposition  of  the  unionists,  whose  organizations, 
largely  controlled  by  the  Socialists,  can  not  consistently  object  to  the 
application  of  machinery.  Many  such  devices,  however,  are  not  of 
practical  utility  in  many  regions  where  the  acreages  are  generally  very 
small  and  cultivated  intensively,  as  in  Tuscany,  for  instance,  where  on 
a  small  farm  olive  trees  and  vines  are  cultivated  in  the  same  field  as 
the  corn,  which  is  sown  in  narrow  strips  between  them.  Also  large 
areas  are  hilly  or  mountainous,  and  there  again  machines,  such  as 
reapers  or  mowers,  would  be  impracticable.  But  in  Lombardy,  Emilia, 
Latium.  and  elsewhere,  there  is  an  increasing  demand  for  agricultural 
machinery,  and  in  some  districts  there  is  a  tendency  towards  cooper- 
ative purchase  and  operating  of  same. 

It  might  be  presumed  that  the  highly  increased  cost  of  labor  would 
have  diminished  noticeably  the  returns  cashed  by  the  landowners  and 
thus  have  tended  to  depress  land  values.  It  would  appear,  however, 
that  the  reverse  has  taken  place.  This  is  due  in  the  first  place  to  the 
improved  methods  of  farming  introduced,  partly  as  the  result  of  the 
increased  cost  of  labor  and  partly  owing  to  the  active  educational  prop- 
aganda carried  on  by  the  Italian  government  by  means  of  traveling 
chairs  of  agriculture,  experimental  fields,  etc.,  and  also  to  the  decline 
in  the  capitalization  value  of  money.  The  value  of  many  products  has 
also  risen  considerably.  Another  determining  factor  is  the  land-hunger 
of  the  Italian  emigrants  who  return  home  with  their  savings  and  who 
are  keen  bidders  for  available  land,  which  they  are  willing  to  acquire  at 
almost  any  price  to  gratify  their  ambition  to  become  landowners  on 
however  so  small  a  scale. 

CONDITION  OP  THE  LABOR  MARKET. 

It  is  feared  that  should  commercial  depression  in  America  continue 
and  lead  to  the  return  on  a  large  scale  of  Italian  emigrants,  such  return 


10  REPORT  OF  SPECIAL  LABOR   COMMISSIONER. 

/ 

would  tend  to  overload  the  labor  market,  and  might  seriously  disturb 
recent  prosperity  and  check  the  advance  in  wages,  prices,  and  land 
values  which  has  been  continuous  of  late.  So  far,  however,  the  official 
returns  received  by  the  Labor  Bureau  show  that  although  large  numbers 
of  emigrants  have  returned,  no  bad  effects  have  as  yet  been  felt;  and 
indeed  their  return  is  welcomed  in  many  districts  where  the  scarcity 
of  labor  has  begun  to  be  so  seriously  felt  as  to  constitute  a  cause  of 
impoverishment  to  the  southern  provinces  and  to  compromise  their 
economic  prosperity. 

STRIKES. 

In  a  conversation  with  Professor  Giovanni  Montemartini.  Director  of 
the  Labor  Bureau,  I  made  some  inquiries  as  to  the  nature  of  the  great 
agricultural  strike  now  being  fought  in  the  province  of  Parma,  which 
is  focusing  the  attention  of  Italians  of  all  parties  on  the  problems  con- 
nected with  labor,  and  I  elicited  from  him  that  Parma  and  the  neigh- 
boring districts  of  central  Italy  are  hard  affected  by  the  emigration 
movement,  which  has  done  so  much  to  raise  wages  in  other  parts  of 
Italy,  and  consequently  the  agricultural  laborers  have  had  to  resort  to 
organization  and  strikes  in  order  to  improve  their  conditions.  Recently 
the  peasant  organizations  of  the  province  of  Parma  have  come  under 
the  influence  of  the  "Syndicalist"  section  of  the  Socialist  party,  which 
is  in  favor  of  direct  economic  as  opposed  to  parliamentary  action,  and 
favors  a  policy  of  harassing  the  landowners  by  continual  strikes,  boy- 
cotts, etc.,  in  the  hope  that  they  will  at  last  find  it  impossible  to  carry 
on  their  farming  operations,  and  will  thus  be  willing  to  rent  their  lands 
to  unions  of  peasants,  who  would  propose  to  exploit  them  collectively. 
This  is  the  theory  underlying  the  syndicalist  movement,  but  in  practice 
the  strike  has  been  fought  with  the  usual  peaceful  methods  on  the  side 
of  the  peasants,  and  the  whole  dispute  has  turned  on  a  question  of  the 
failure  of  the  landowners  to  comply  with  certain  clauses  of  an  agree- 
ment stipulated  between  them  and  the  peasantry  in  1905.  But,  on  the 
other  hand,  the  landowners  have  organized  and  are  now  conducting  the 
strike  in  an  aggressive  spirit  with  the  object  of  breaking  up  the  organ- 
izations, and  enforcing  the  principle  of  the  "open  shop."  Twenty 
thousand  organized  peasants  arc  involved  in  this  strike,  which  has 
already  lasted  over  a  month,  and  the  termination  of  which  it  is  impos- 
sible to  foresee.  The  landowners  have  succeeded  in  migrating  their 
live  stock,  one  of  the  principal  assets  of  the  province,  to  other  parts  of 
the  country,  the  peasants  on  their  side  are  sending  away  their  children, 
who  are  gratuitously  received  and  cared  for  by  the  organized  workers 
in  the  towns  all  over  the  peninsula.  The  government  so  far  has  pre- 
served an  absolutely  neutral  attitude. 

The  agricultural  laborers'  organizations  are   federated,  and  the   na- 


ITALY. 


11 


tional  federation  counted  over  :if>0.000  members  a  few  years  ago.  its 
membership  is  now  reduced  to  270.000,  as  the  organizations  which  have 
come  under  the  syndicalist  influence,  such  as  those  of  Parma,  have 
seceded.  ' 

(COMPULSORY  ARBITRATION. 
To  my  inquiries  as  to  how  the  question  of  compulsory  arbitration 
as  viewed  in  Italy,  Professor  Montemartini  replied  that  public  opinion 
on  the  question  is  directed  along  three  currents,  one  favoring  the 
creation  of  permanent  arbitration  boards,  to  which  the  parties  to  a 
dispute  could  voluntarily  have  recourse  at  any  time ;  another  in  favor 
of  compulsory  conciliation  boards,  to  which  all  disputes  Avould  have  to 
be  submitted  before  either  masters  or  men  could  declare  hostilities; 
and  a  third  in  favor  of  compulsory  arbitration.  The  serious  dimensions 
assumed  of  late  by  strikes,  such  as  those  of  railway  employees,  and 
more  especially  the  gravity  of  many  agrarian  strikes  in  some  of  which 
the  military  have  been  called  out  and  many  lives  lost,  has  strongly 
influenced  public  opinion  in  this  direction.  It  is  easy,  however,  to 
resee  that  great  difficulties  would  arise  in  enforcing  any  such  measure, 
e  measure  which  the  Socialist  deputy.  Hon.  Bissolati.  intends  placing 
fore  the  Chamber,  proposes  to  penalize  manufacturers  who  refuse  to 
ey  the  award  of  the  arbitration  board  by  closing  their  establishments, 
t  no  penalties  are  proposed  for  the  workers  who  offer  no  security, 
e  measure  supported  by  the  If  on.  Xicolini  proposes  to  keep  back  as 
urity  for  the  workers  a  certain  proportion  of  their  wages  till  the 
initiation  of  the  agreement  under  which  they  are  engaged,  but  this 
again  would  be  impracticable,  except  in  certain  classes  of  labor.  On  the 
whole,  it  may  be  said  that  there  is  a  tendency  among  employers  in 
industry  to  oppose  compulsory  arbitration,  while  the  landowners  would. 
as  a  rule,  favor  it.  The  Director  of  the  Labor  Bureau  himself  is 
opposed  to  the  principle  of  compulsory  arbitration,  as  he  considers  it 
wrong  in  principle  and  impracticable,  except  perhaps  in  those  few 
industries  which  are  government  monopolies  and  in  which  it  is  possible 
to  know  the  exact  cost  of  production,  and  which  have  nothing  to  fear 
from  foreign  competition.  He  fears  that  in  practice  it  might  often 
have  the  effect  of  ruining  an  industry  and  increasing  lack  of  employ- 
ment. Undoubtedly  the  general  public  is,  however,  in  favor  of  some  such 
measure,  as  also  certain  sections  of  the  Socialist  party,  though  opinion 
there  is  very  divided,  as  is  seen  by  the  fact  that  the  railway  workers' 
union  has  rejected  the  offer  of  compulsory  arbitration.  The  Prime 
Minister.  Giolitti,  has  made  declarations  in  the  Chamber  to  the  effect 
that  he  does  not  favor  for  the  present  any  project  for  compulsory 
arbitration,  and  that  he  considers  it  premature  to  talk  of  incorporating 
the  labor  unions,  as  is  proposed  in  one  of  the  measures  to  be  brought 
before  the  Chamber. 


12  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

Dr.  Carroncini,  also  of  the  Labor  Bureau,  informs  me  that  next 
month  a  law  will  come  into  operation  for  regulating  the  conditions  of 
labor  of  workers  in  the  rice  fields  in  the  provinces  of  Verona,  Pavia, 
and  Ferrara,  and  this  law  contains  a  clause  for  compulsory  arbitration 
of  disputes  which  may  arise  in  this  special  industry.  The  board  of 
arbitrators  is  to  consist  of  three  umpires  selected  by  the  masters  and 
three  by  the  men,  presided  over  by  the  pretore  or  local  magistrate,  and 
its  decisions  are  to  be  final  and  without  appeal.  Any  refusal  to  obey 
the  award  will  be  punished  by  fines,  amounting  in  the  case  of  the 
workers  to  from  30  to  40  lire  and  in  that  of  the  employers  to  from  300 
to  400  lire.  In  the  case  of  the  workers  it  is  proposed  to  garnishee  their 
wages  in  payment  of  the  fines.  The  initiative  of  this  law  was  taken  by 
the  government  at  the  instigation  of  the  landowners,  and  has  met  with 
much  opposition  on  the  part  of  the  workers,  and  it  is  foreseen  that  it 
will  be  enforced  with  difficulty.  The  disputes  wrhich  it  will  be  called  to 
decide  upon  will  be  mostly  on  minor  questions  concerning  chiefly  the 
interpretation  of  contracts.  Should  the  law  be  successful  in  operation, 
it  is  likely  to  be  broadened  so  as  to  cover  other  categories  of  agri- 
cultural work.  Dr.  Carroncini  does  not  himself  believe  compulsory 
arbitration  practicable  or  desirable,  and  remarks  that  in  agricultural 
struggles  it  is  wished  for  by  the  landowners,  but  opposed  by  the  workers 
themselves.  He  considers  that  in  all  strikes  the  government  should 
observe  strict  neutrality,  limiting  its  action  to  preserving  peace,  and 
he  considers  that  the  conditions  in  agricultural  struggles  are  such  that 
when  the  government  merely  confines  its  action  within  these  limits,  it 
is  already  exercising  pressure  in  favor  of  the  landowners. 

Nineteen  hundred  and  seven  was  a  record-breaking  year  for  strikes 
in  Italy,  as  they  attained  the  number  of  2,500,  as  against  900  for  1906 
and  600  for  1905;  it  is  probable  now  that  the  number  will  tend  to 
decrease. 


13' 


RUSSIA. 


have  found  that  at  this  particular  time  it  can  hardly  be  said  that 
Russia,  like  other  countries,  has  a  labor  problem.  It  has  solved  this 
problem  in  rather  an  unique  way,  and  yet  not  in  a  way  that  I  should 
care  to  recommend  to  the  government  of  California  or  to  any  other 
government.  Prior  to  1905  the  government  did  not  legalize  the  forma- 
tion of  labor  unions.  During  the  period  of  the  revolutionary  movement 
of  that  year,  the  government,  in  addition  to  granting  a  constitution  and 
other  concessions,  also  gave  to  labor  the  privilege  to  organize.  The 
workingmen  in  all  industrial  parts  of  the  empire  promptly  availed 
themselves  of  this  concession,  and  powerful  labor  unions  were  speedily 
formed. 

In  Russian  Poland,  where  are  located  the  great  manufacturing  cen- 
ters of  Warsaw  and  Lodz,  the  industrial  workers  have  been  largely 
recruited  from  the  peasantry.  This  element,  when  brought  into  the 
cities  and  away  from  home  restraints,  became  more  or  less  savage. 
Once  organized  and  led,  as  many  of  them  were,  by  Socialists  and  polit- 
ical leaders,  who  seemingly  meant  to  use  these  organizations  for  revo- 
lutionary purposes,  they  became  most  unreasonable  in  their  demands, 
and  when  these  demands  were  denied,  did  not  hesitate  to  resort  to  the 
knife  and  the  revolver.  In  consequence,  many  violent  strikes  took 
place,  and  for  a  time  a  reign  of  terror  existed  in  these  centers.  This 
situation,  as  I  will  presently  show,  played  directly  into  the  hands  of 
the  government. 

It  would  seem  that  the  Czar  had  yielded  most  unwillingly  to  the 
policy  of  granting  a  constitution  and  other  concessions  in  the  direction 
of  personal  and  civil  liberty.  That  these  privileges  were  granted  was 
due  to  the  government  overestimating  the  strength  of  the  revolutionary 
party.  The  moment  the  Czar  felt  sure  of  the  army  and  a  slight  weak- 
ness was  shown  on  the  part  of  the  revolutionists,  he  immediately 
instituted  a  reactionary  policy.  A  "pogrom"  was  arranged  in  secret 
by  the  "  higher  ups"  of  the  government  circles  which  was  to  go  into 
effect  simultaneously  all  over  the  empire,  and  which  was  to  include  a 
massacre  of  the  revolutionists  and  those  presumed  to  be  in  sympathy 
with  them. 

These  massacres  were  to  be  conducted  by  a  body  since  become  known 
as  the  "Black  Hundreds,"  the  rank  and  file  of  which  were  made  up 
of  outcasts  and  criminals,  known  in  Russia  by  the  English  title  of 
"Hooligans."  These  Hooligans  were  to  receive  the  protection,  and  did 


14  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

receive  the  protection  of  the  military  and  the  police.  And  under  the 
direction  and  protection  of  these  governmental  forces,  thousands  of 
innocent  men,  women,  and  children  were  butchered  and  slaughtered 
in  many  cities,  towns,  and  villages  throughout  the  empire  for  several 
days,  and  the  contents  of  their  homes  and  shops  were  looted  and  carried 
away  by  these  freebooters  with  the  fullest  knowledge  and  consent  of, 
and  aided  and  abetted  by,  the  military  and  the  police. 

The  charge  has  been  made  that  the  Czar  himself  was  at  the  head  of 
this  movement  •  that  in  advance  he  had  promised  to  pardon  every  mem- 
ber of  the  Black  Hundred  who  might  be  convicted  of  any  crime  com- 
mitted during  the  proposed  massacre. 

What  lends  color  to  this  charge,  and  what  is  maintained  to  be  abso- 
lute proof  of  his  complicity  in  these  murders,  is  the  fact  that  he  has 
seemingly  kept  faith,  and  that  he  has  actually  pardoned  every  man 
since  convicted  in  the  courts  of  murder,  arson,  outrage,  incendiarism, 
and  all  the  other  dreadful  crimes  committed  during  the  days  and  nights 
of  terror.  Just  at  this  writing,  and  as  additional  proof  that  the  Czar 
was  at  least  in  perfect  sympathy  with  the  acts  of  the  Hooligans,  comes 
a  wire  dated  at  St.  Petersburg,  and  published  in  a  London  journal, 
reading  as  follows:  "It  having  been  proposed  to  lessen  the  term  of 
punishment  inflicted  on  all  the  people  condemned  for  being  implicated 
in  the  Kieff  'pogrom.'  the  Czar  has  granted  them  a  complete  amnesty." 

The  statement  was  made  to  me  by  a  prominent  lawyer  in  Moscow 
who  had  carefully  investigated  the  matter,  that  out  of  the  thousands 
who  took  part  in  these  massacres  in  various  parts  of  the  empire  and 
who  shed  untold  quantities  of  innocent  blood,  there  is  not  one  single 
offender  to-day,  despite  hundreds  of  convictions,  to  be  found  m  the 
prisons  of  Eussia. 

On  October  30,  1905,  the  Czar  in  his  proclamation  to  the  people 
among  other  things  said,  "We  lay  upon  our  government  the  duty  of 
executing  our  inflexible  will  by  giving  to  the  people  the  foundations 
of  civil  liberty  in  the  form  of  real  inviolability  of  personal  rights,  free- 
dom of  conscience,  freedom  of  speech,  freedom  of  public  assembly,  and 
freedom  of  organized  association." 

SUPPRESSION  OF  LABOR  ORGANIZATIONS. 

In  consistence  with  the  policy  of  reaction  begun  by  the  Czar  imme- 
diately on  the  heels  of  this  generous  and  liberal  declaration,  steps 
were  taken  to  suppress  all  labor  organizations.  The  labor  leaders 
who  permitted  or  encouraged  violence  on  the  part  of  union  strikers 
played  directly  into  the  hands  of  the  government  by  furnishing  the 
needed  pretext  for  the  suppression  of  unionism,  and  despite  the 
claim  made  that  only  a  percentage  of  the  unionists  committed  acts  of 
violence,  all  unions  were  suppressed.  According  to  the  unrepealed 


HI 'SSI A.  15 

laws  of  Russia,  labor  is  permitted  to  organize,  but  as  a  matter  of  fact, 
no  labor  meeting  is  permitted  to  take  place  without  the  consent  of  the 
chief  of  police,  which  consent  is  never  obtainable.  In  consequence, 
labor  unionism  in  Russia  for  the  time  being  is  paralyzed,  and  owing 
to  lack  of  organization  and  also  to  lack  of  strike  funds,  strikes  of  any 
duration  are  practically  impossible. 

The  statement  was  made  to  me  by  a  leading  Russian  professor  of 
political  economy,  who  is  an  authority  on  the  Russian  labor  question, 
that  the  Minister  of  the  Interior  refused  to  grant  a  certain  employer 
permission  to  make  certain  wage  concessions  to  his  employees  on  the 
ground  that  to  do  so  would  encourage  other  wage-earners  to  make 
demands  and  thus  lead  to  possible  strikes. 

At  one  of  the  great  iron  mills  in  southern  Russia,  after  a  lengthy  • 
interview  with  several  wage-earners  in  the  presence  of  the  manager, 
I  said  to  them,  "Am  I  to  understand  that  if  you  have  grievances  and 
hold  a  meeting  to  discuss  them,  agree  upon  them,  set  them  forth  on  paper 
and  appoint  a  committee  to  present  them  to  your  employer  for  his 
consideration,  that  you  would  be  liable  to  punishment  at  the  hands  of 
the  authorities?"  "If  we  do  all  that  you  say,"  they  answered,  "the 
members  of  such  a  committee  would  speedily  find  themselves  on  the 
road  to  Siberia." 

Appealing  to  the  employer  I  asked  if  he  did  not  think  that  such 
treatment  of  labor  on  the  part  of  the  authorities  was  most  cruel  and 
unjust.  He  answered  saying  that  labor  was  not  the  only  factor  liable 
to  such  summary  treatment.  "I  do  not  know  what  moment  I,  as  an 
employer,  may  be  thrown  into  prison  by  the  order  of  the  governor 
general  of  this  province,  who  is  all  powerful,  being  in  supreme  control, 
and  from  whose  judgments  there  is  no  appeal — kept  there  indefinitely, 
and,  perhaps,  finally  transported  to  Siberia  without  even  being  informed 
of  the  nature  of  my  offense  or  given  an  opportunity  for  a  hearing  or  a 
fair  trial." 

In  this  wise,  labor  organizations  in  Russia  have  been  terrorized  by 
the  government,  and  while  secret  unionism  more  or  less  prevails,  its 
possibilities  are  enfeebled,  and  it  can  serve  little  or  no  practical  pur- 
pose, for  the  reason  that  the  members,  and  more  especially  the  leaders, 
are  subject  to  arrest,  imprisonment,  and  exile  as  soon  as  they  show 
their  heads. 

DIMINISHED   EFFICIENCY   OF   RUSSIAN  LABOR. 

In  the  face  of  these  conditions  one  would  be  led  to  believe  that  Russia 
should  be  the  manufacturers'  Mecca.  Here,  at  least,  he  may  be  per- 
mitted to  conduct  his  business  without  interference  on  the  part  of  the 
labor  picket  or  the  walking  delegate.  Here  he  need  now  have  no  fears 
of  arrogant  labor  committees  calling  on  him  and  making  unreasonable 


16  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

demands  which  he  dare  not  refuse  without  the  risk  of  a  strike  which 
might  destroy  his  business. 

I  think  it  was  Herbert  Spencer  who  once  said  that  if  you  strike  a 
blow  with  a  hammer  on  a  smooth  sheet  of  tin  you  will  find  a  dent 
therein;  but  if  you  turn  the  sheet  of  tin  over  you  will  find  a  corre- 
sponding elevation  on  the  other  side.  The  same  law  of  cost  and  com- 
pensation is  working  its  way  out  with  the  Russian  labor  situation. 
Instead  of  Russia,  because  of  the  suppression  of  labor  unions,  being  the 
manufacturers '  Mecca,  it  is  proving  to  him  a  Waterloo. 

Every  Russian  manufacturer  with  whom  I  spoke,  and  I  had  the 
opportunity  of  speaking  with  some  of  the  largest  in  the  empire, 
informed  me  that  the  diminishing  efficiency  of  the  Russian  workman 
was  becoming  so  serious  that  it  was  getting  to  be  more  and  more  of  a 
problem  as  to  how  they  could  retain  their  business  against  the  com- 
petition of  foreign  manufacturers  who  had  the  advantage  of  more 
efficient  labor,  and  who  were  successfully  invading  their  territory. 

"Is  the  charge  true  that  is  made  by  employers  that  the  efficiency  of 
the  Russian  workman  is  declining?"  I  asked  a  group  of  intelligent 
Russian  wage-earners  whom  I  was  interviewing. 

"  It  is  with  regret  that  we  must  admit  it  to  be  true, ' '  they  replied. 

"Why  is  it  true?" 

"Because,"  they  answered,  "our  employers  are  in  league  with  the 
government  to  oppress  and  to  suppress  us.  We  have  had  locks  put  on 
our  lips  and  manacles  on  our  hands.  We  are  helpless  and  almost  hope- 
less. Surely,  under  these  conditions,  we  can  not  be  expected  to  be  wildly 
enthusiastic  over  our  employers'  interest,  nor  can  we  be  expected  to 
give  forth  our  best  in  return  for  treatment  which  is  the  worst.  What 
have  we  to  gain  by  working  ourselves  down  to  the  bone?  Nothing, 
absolutely  nothing.  We  can  hope  neither  for  appreciation  nor  for 
more  pay,  and  so  it  is  only  natural  for  us  under  these  circumstances 
to  give  in  return  the  least  we  can. 

This  object  lesson  effectively  demonstrates  the  human  law,  that  the 
governmental  policy  which  destroys  freedom  of  organized  association, 
as  in  Russia,  destroys  at  the  same  time  the  spirit  of  the  worker  also  as 
in  Russia,  and  turns  the  willing  workman  into  an  unwilling  workman, 
thus  making  it  impossible  for  such  nation  to  advance  or  even  to  maintain 
its  industrial  position  among  the  industrial  nations  of  the  world. 

There  is  no  other  country  in  the  world,  the  United  States  not  excepted, 
that  is  so  rich  in  material  resources  as  the  empire  of  Russia.  Its  hills 
and  its  mountains,  its  mines  and  its  valleys,  contain  the  hidden  treasures 
of  all  the  Indies.  Yet,  in  the  face  of  all  this  undeveloped  but  potential 
wealth,  untold  millions  of  Russians  go  hungry  from  the  cradle  to  the 


grave. 


Under  an  honest,  wise,  and  beneficent  administration.  Russia  could 


RUSSIA.  IT 

become  the  wage-earners'  Mecca,  and  Russian  labor  could  be  made 
happy  and  prosperous  to  a  degree  not  to  be  surpassed  in  any  other 
land.  But  as  it  is,  the  present  condition  and  the  future  outlook  for 
Russian  labor  is  most  gloomy  and  discouraging. 

STRIKES. 

In  consequence  of  the  strikes  of  1905  and  1906,  wages  have  risen  from 
fifteen  per  cent  to  thirty  per  cent,  but  the  cost  of  living  has  risen  pro- 
gressively, so  that  as  a  matter  of  fact,  the  absolute  wages  of  the  work- 
ingman  have  not  increased,  and  where  in  the  absence  of  organization 
no  increase  in  wages  took  place,  the  wage-earner  because  of  the  increased 
cost  of  living  is  worse  off  than  ever. 

The  only  real  advantage  gained  through  strikes,  and  still  enjoyed  by 
many  wage-earners,  is  the  shortening  of  the  hours  of  labor.  The  legal 
Russian  working  day  is  eleven  and  one  half  hours ;  the  general  working 
day  at  this  time  is  ten  hours,  but  many  of  the  iron  works  have  a  nine- 
hour  day,  and  some  of  the  municipal  undertakings  have  an  eight-hour 
day. 

WAGES. 

Owing  to  the  numerous  religious  and  other  holidays  there  are  only 
from  two  hundred  and  eighty  to  two  hundred  and  eighty-five  labor  days 
in  the  year.  This,  of  course,  militates  against  the  earning  power  of  the 
wage-earner,  who,  as  a  rule,  is  paid  by  the  hour  or  by  the  working  day. 

The  average  wages  of  Russian  workingmen  will  run  from  one  hundred 
to  one  hundred  and  fifty  dollars  per  annum.  The  cost  of  food  for  a 
Russian  workingman  is  about  four  dollars  and  a  half  a  month.  His 
diet  consists  of  bread,  vegetables,  and  groats,  meat  rarely  if  ever  being 
in  reach  of  his  meager  earnings. 

The  condition  of  the  peasants  is  even  worse  than  that  of  the  indus- 
trial workers.  Professor  Oseroff  of  the  University  of  St.  Petersburg, 
one  of  Russia's  greatest  political  economists,  is  my  authority  for  the 
statement  that  the  average  wage  of  peasant  women  who  do  the  hardest 
sort  of  manual  field  labor  is  at  the  rate  of  ten  cents  for  a  day,  which 
begins  at  four  a.  m.  and  does  not  end  till  eight  p.  m.,  and  out  of  this 
pittance  she  must  furnish  her  own  food.  Moreover,  he  went  on  to  say 
that  at  times  there  are  multitudes  of  women  who  stand  in  line  waiting 
for  an  opportunity  to  secure  work  on  these  pitiable  conditions.  In  the 
villages  I  have  seen  peasant  girls  employed  as  domestics  for  as  little 
as  one  dollar  a  month,  and  seemingly  glad  of  the  opportunity  to  get 
food  and  shelter  which  their  own  homes  do  not  afford. 

Male  peasants  in  summer  earn  from  fifteen  cents  to  fifty  cents  a  day, 
and  in  winter  from  six  cents  to  twenty  cents  a  day,  according  to  the 
quality  and  the  strength  of  the  worker. 

The  need  for  saving  in  the  summer  on  the  better  wage  rate  in  order 

2 


18  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

not  to  starve  in  the  winter  when  there  is  not  enough  employment  to  go 
round,  when  there  are  great  armies  of  unemployed  peasants,  is  so 
imperative  that  a  farmer  employing  a  goodly  number  of  peasants 
informed  me  that,  as  a  rule,  most  of  his  peasant  men  and  women  work 
all  the  summer  without  spending  one  single  penny  for  personal  needs 
outside  of  food. 

The  manufacturing  employers  seem  to  feel  that  their  inability  to 
compete  successfully  with  foreign  manufacturers  is  due  to  the  short- 
ened hours  of  labor  and  the  increased  wage  brought  about  by  strikes. 
Now  that  strikes,  because  of  the  attitude  of  the  government,  have 
become  almost  impossible,  they  are  taking  steps  to  make  a  united  effort 
to  lengthen  the  working  day  and  to  cut  down  wages.  All  this  in  the 
face  of  increased  cost  of  living  from  which  the  wage-earner  can  not 
escape. 

In  the  opinion  of  a  disinterested  investigator  such  a  policy,  if  suc- 
cessfully carried  out,  can  but  make  a  bad  industrial  condition  much 
worse.  Longer  hours  and  cuts  in  wages  must  further  add  to  the  dis- 
content and  misery  of  the  Russian  wage-earner,  and  tend  to  make  him 
still  more  inefficient,  thus  making  it  less  and  less  possible  for  the 
Russian  manufacturer  to  maintain  his  business  even  in  his  own  home 
market,  to  say  nothing  of  the  markets  of  the  world. 

CONDITION  OF  RUSSIAN  WAGE-EARNER. 

The  lot  of  the  Russian  wage-earner  is  the  most  unhappy  in  all  the 
Occident,  and  so  long  as  it  remains  the  policy  of  the  Russian  govern- 
ment to  put  a  premium  on  ignorance,  to  discourage  the  education  of 
her  masses,  to  deliberately  encourage,  as  she  does  on  every  hand,  vice 
and  immorality,  in  order  to  divert  the  thought  and  the  energy  of  the 
people  from  politics,  so  long  as  the  declaration  of  the  Czar  of  October 
30,  1905,  that  it  is  his  inflexible  will  to  give  to  the  people,  among  other 
things,  the  freedom  of  organized  association,  remains  a  byword  and  a 
barefaced,  empty  lie,  so  long  must  the  condition  of  the  Russian  wage- 
earner  remain  the  most  unhappy  in  all  the  Occident. 

Russia  has  nothing  to  offer  in  the  way  of  hints  or  suggestions  as  to 
the  most  scientific  method  of  preventing  strikes  and  lockouts,  other  than 
by  the  most  brutal  use  of  force,  by  the  exercise  of  arbitrary  power  and 
by  robbing  the  wage-earner  of  the  freedom  of  organized  association. 

Russia,  however,  by  her  mediasval  and  brutal  methods  in  the  treatment 
of  labor,  stands  out  as  a  most  valuable  object-lesson  to  the  world  how 
best  to  degrade  the  working  classes,  how  best  to  arouse  in  them  hatred 
and  ill  will,  how  best  to  fill  their  hearts  with  disloyalty  to  the  govern- 
ment under  which  they  live,  how  best  to  destroy  their  efficiency  by 
killing  the  best  within  them  and  bringing  out  the  worst  within  them, 
and  how  best  to  make  it  impossible,  despite  boundless  natural  wealth,  to 
become  a  prosperous  industrial  nation. 


AUSTRIA.  19 


AUSTRIA. 


I 


As  Vienna  is  regarded  by  Austrian  wage-earners  as  the  city  where 
the  conditions  for  Austrian  labor  are  the  most  favorable,  and  as  Vienna 
is  also  the  capital  of  the  empire  where  are  to  be  found  the  head  centers 
for  all  information  concerning  labor  and  labor  laws,  I  confined  the 
limited  time  at  my  command  to  that  city,  where  I  was  enabled  to  make 
a  fairly  exhaustive  investigation  and  to  get  many  different  points  of 
view  on  the  question  under  investigation. 

Through  the  courtesy  of  our  American  Ambassador,  Charles  D. 
Francis,  I  was  enabled  to  meet  the  State  Minister  of  Commerce, 
Dr.  Alfred  Grunsberger,  and  the  State  Minister  of  Public  Works, 
Dr.  Albert  Gessmann,  to  both  of  which  gentlemen  I  am  indebted  for 
much  information. 

Opportunities  were  also  afforded  me  to  have  an  audience  with  Mayor' 
Lueger  of  Vienna,  to  meet  with  the  secretaries  of  the  Federated  Trades 
and  the  Employers'  Association,  with  several  members  of  the  Austrian 
Parliament  who  are  also  labor  leaders,  with  editors  of  labor  papers,  and 
with  various  groups  of  workingmen.  Opportunity  was  also  given  me 
to  visit  numerous  homes  of  wage-earners  and  to  talk  directly  with  the 
occupants,  so  that  on  the  whole  my  investigations  were  of  a  character 
to  give  me  many  different  points  of  view  on  labor  conditions  and  labor 
laws.  I  found  some  of  these  points  of  view  most  conflicting,  as  the 
interests  of  the  informants  happened  to  conflict.  I  followed  the  plan, 
however,  of  reaching  conclusions  by  facts  presented  rather  than  by 
opinions  offered. 

CONDITION  OF  AUSTRIAN  WAGE-EARNER. 

Compared  with  his  fellow-worker  in  Russia,  I  found  the  condition 
of  the  Austrian  wage-earner  most  enviable.  On  the  whole,  the  Austrian 
orkman  is  better  off  than  ever  before,  though  there  is  very  great  room 
or  further  improvement  in  his  condition.  The  Austrian  wage  scale 
has  for  several  years  been  upward,  until  the  recent  depression,  which 
naturally  checked  this  tendency;  but,  as  yet,  there  have  been  few 
instances  where  wages  have  been  cut,  and  unless  trade  conditions  grow 
materially  worse,  there  is  no  present  likelihood  of  wages  declining.  I' 
found,  however,  that  this  upward  trend  of  wages  in  recent  years  was 
largely  confined  to  those  branches  of  industry  which  have  become 
unionized. 


20  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

There  has  also  been  a  progressive  increase  in  the  cost  of  living,  so 
that  unorganized  labor,  which  has  not  participated,  as  a  rule,  in 
increased  wages,  has  been  badly  pinched  by  the  increased  cost  of  rent 
and  of  foodstuffs. 

The  legal  hours  for  a  day's  labor  in  Austria  are  eleven.  The  actual 
average  working  hours,  however,  are  nine  and  a  quarter. 

The  average  earnings  of  an  industrial  worker  are  $240  a  year,  out  of 
which  he  contributes  $20,  or  eight  per  cent,  to  the  funds  of  labor  unions. 
According  to  the  statement  of  Dr.  Max  Kaiser,  the  secretary  of  the 
Employers'  Association  of  Austria,  $2,800,000  of  such  funds  had  been 
used  for  political  purposes  in  supporting  the  work  of  the  Social  Demo- 
crats, and  $400,000  were  used  for  strikes. 

LABOR   IN   POLITICS. 

Labor  has  largely  concentrated  its  efforts  on  politics.  Under  the 
name  of  "Social  Democrats,"  it  wields  important  political  power,  hav- 
ing eighty-seven  representatives  in  the  lower  house.  By  voting  as  a 
unit,  this  labor  party  has  made  itself  keenly  felt,  especially  since  the 
.representatives  of  the  capitalistic  and  employing  classes  are  split 
up  into  numerous  political  parties,  thus  minimizing  their  political 
strength. 

TAXES. 

In  addition  to  contributing  eight  per  cent  of  his  earnings  to  labor 
unions,  the  Austrian  workman  is  obliggd  to  pay  direct  state  taxes 
equivalent  to  about  nine  per  cent  of  his  income.  This  reduces  his 
purchasing  power  to  a  sum  on  which  it  would  seem  impossible  to  the 
American  workman  even  to  exist,  especially  in  the  face  of  the  stern 
fact  that  in  the  last  few  years  the  cost  of  living  in  Austria  has  increased 
from  twenty-five  to  thirty-five  per  cent.  As  a  consequence,  even  the  best 
paid  Austrian  wage-earner  does  not  enjoy  the  comforts,  the  conveniences, 
nor  the  standard  of  living  within  the  reach  of  the  ordinary  American 
unskilled  laborer.  A  workingman  in  Vienna,  however  favorable  his 
conditions,  rarely,  if  ever,  occupies  more  than  one  room  and  a  kitchen 
for  self  and  family,  no  matter  how  large  his  family.  I  have  visited  the 
homes  of  skilled  wage-earners  in  Vienna,  consisting  of  a  room  and 
kitchen,  which  were  occupied  by  families  of  as  many  as  nine  persons. 
There  are  multitudes  of  wage-earners  who  occupy  but  one  room  for 
self  and  family. 

WAGE-EARNER'S  DIET. 

The  wage-earner's  diet,  as  a  rule,  consists  of  bread,  vegetables,  and 
coffee,  and  if  his  family  is  not  too  large,  of  scrap  meat  for  Sunday 
dinner. 


A 1  "STRIA. 


21 


SICKNESS  AND  OLD  AGE  PENSIONS. 

He  enjoys,  however,  this  advantage  over  the  average  American  work- 
man. In  the  event  of  sickness  he  is  furnished  by  the  State  with  free 
medical  treatment  and  free  medicine,  and  also  an  amount  from  the  state 
sick  fund,  equivalent  to  sixty  per  cent  of  his  annual  wages,  to  which 
his  employer  has  contributed  one  third  and  he  has  contributed  two 
thirds.  This  allowance  is  given  him  for  a  period  of  twenty  weeks.  In 
the  event  of  a  disabling  accident,  he  likewise  receives  a  State  allowance 
equivalent  to  sixty  per  cent  of  his  annual  earnings,  to  which  he  has 
contributed  ten  per  cent  and  his  employer  ninety  per  cent. 

The  question  of  old  age  pensions  is  also  being  agitated  at  this  time, 
and  the  Austrian  Parliament  has  such  a  measure  now  under  advisement. 

STRIKES. 

The  rapid  increase  in  the  ranks  of  union  labor  has  tended  to  an 
increase  in  strikes.  The  official  record  for  recent  years  stands  as 
follows : 

Number  of  strikes  in  1902 246 

Number  of  strikes  in  1903 324 

Number  of  strikes  in  1904 414 

Number  of  strikes  in  1905 686 

Number  of  strikes  in  1906 1083 

RECOGNITION   OF   UNIONS. 

The  great  fight  that  is  being  made  by  Austrian  labor  is  to  obtain 
recognition  at  the  hands  of  the  employers.  By  virtue  of  its  growing 
strength  it  has  commanded  recognition  on  the  part  of  the  smaller 
employers,  which,  as  a  rule,  now  recognize  the  labor  unions.  The  larger 
employers,  however,  do  not,  as  a  rule,  recognize  labor  organizations, 
and  are  uniting  more  and  more  with  the  view  of  collectively  refusing 
to  recognize  union  labor.  Aside  from  the  carpenters'  union  of  Vienna, 
the  "open  shop,"  as  a  rule,  prevails  throughout  Austria.  Austrian 
labor  unionism,  it  is  claimed  by  its  leaders,  stands  for  temperance,  for 
the  intellectual  development  of  the  wage-earner,  and  for  a  faithful 
observance  of  labor  contracts. 

Wherever  labor  unionism  is  recognized,  the  tendency  of  employers 
and  of  unions  is  in  the  direction  of  making  contracts  running  from 
three  to  five  years.  The  labor  federation  insists  upon  the  strict  observ- 
ance of  these  contracts  on  the  part  of  unionists,  a  clause  being  gen- 
erally inserted  in  such  contracts  to  the  effect  that  the  federation  agrees 
to  withhold  support,  financial  and  otherwise,  from  any  union  that 
violates  its  contract,  and,  if  need  be,  to  expel  such  union  from  the 
federation. 

The  labor  unions  in  Austria,  as  in  America,  are  opposed  to  the  unions 


22  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

incorporating,  on  the  ground  that  to  become  legal  bodies  would  lay 
them  open  to  becoming  perpetual  victims  of  legal  proceedings  instituted 
by  the  Employers'  Association  with  the  view  of  disrupting  the  labor 
organizations. 

In  order  to  prevent  the  selfish  among  the  labor  leaders  from  need- 
lessly prolonging  strikes  in  their  own  interests  and  at  the  cost  of  capital 
and  labor,  and  in  order  also  to  prevent  the  union  members  from  being 
terrorized  by  radical  unionists,  the  rule  is  faithfully  followed  during  a 
prolonged  strike  of  taking  a  weekly  secret  ballot  on  the  question,  ' '  Shall 
the  strike  be  continued  ? ' ' 

EFFICIENCY  OF  AUSTRIAN  LABOR. 

Austrian  government  officials,  who  have  carefully  studied  the  Aus- 
trian wage-earner,  confess  that  the  same  man  when  transplanted  to 
American  soil  becomes  much  more  efficient.  In  this  connection  Dr. 
Alfred  Griinberger,  connected  with  the  Ministerial  Department  of 
Trade,  made  the  interesting  statement  that  shortly  after  the  recent 
panic  struck  the  United  States,  news  came  that  thousands  of  Austrian 
wage-earners  were  on  their  way  back  to  Austria.  This  information 
caused  great  uneasiness,  and  committees  were  hastily  formed  and 
employment  offices  organized  in  order  better  to  deal  with  what  wras 
expected  to  be  a  horde  of  returning  suffering  refugees.  The  surprise  of 
the  committees  was  great  when  they  found  the  women  among  the  return- 
ing emigrants  decked  out  in  fashionable  garments,  with  hats  decorated 
with  ostrich  plumes  reaching  high  up  in  the  air,  the  men,  as  a  rule, 
wearing  creased  trousers,  and  all  of  them  wearing  an  astonishing  air 
of  prosperity.  They  were  further  surprised  when  the  offered  employ- 
ment at  eighty  or  ninety  cents  a  day  was  laughed  at  by  the  returning 
wanderers,  who  informed  the  committees  that  they  had  plenty  of  money, 
that  they  were  not  seeking  employment,  and  that  they  had  simply 
availed  themselves  of  the  slack  time  to  take  a  junketing  trip  home  where 
they  intended  to  remain  until  there  was  a  revival  of  American  trade, 
when  they  proposed  to  return  to  the  United  States.  I  was  further 
informed  that  there  is  not  one  case  on  record  where  employment  was 
accepted  at  the  wages  offered. 

The  increased  effort  and  energy  of  the  Austrian  workmen  when 
transplanted  to  American  soil  is  ascribed  largely  to  the  better  general 
social  and  economic  conditions  that  prevail  in  America,  because  of  its 
boundless  resources,  the  higher  esteem  in  which  labor  is  held,  the  far 
greater  opportunities  and  possibility  of  advancement,  and  the  progres- 
sive spirit  of  the  American  employer,  who  is  ever  ready  to  discard 
old  methods  and  introduce  the  most  modern  methods  obtainable. 


AUSTRIA.  23' 

STATE    INTERVENTION    IN    LABOR    DISPUTES. 

While  the  State  has  made  no  legal  provision  to  deal  with  strikes  and 
lockouts,  it  often  happens  that  officials  holding  high  places  take  the 
initiative  of  bringing  the  conflicting  parties  in  labor  disputes  together 
for  the  purpose  of  conciliation.  One  such  official,  Government  Coun- 
cillor Hitter  von  Heutl,  a  particularly  tactful  official  of  the  province  of 
Lower  Austria,  has  in  this  wise  been  the  means  of  settling  successfully 
forty  labor  disputes,  averting  that  many  strikes  and  lockouts. 

This  method  has  grown  into  such  favor  that  the  conflicting  parties 
now  frequently  appeal  to  such  mediators  to  arbitrate  existing  differ- 
ences. 

COMPULSORY  ARBITRATION. 

Of  the  many  who  were  invited  to  express  an  opinion  as  to  the  wisdom 
and  practicability  of  compulsory  arbitration,  only  three  expressed 
favorable  opinions,  His  Excellency  Dr.  Gessmann,  Minister  of  Public 
Works;  Herr  Frederick  Elsinger,  a  prominent  manufacturer,  and 
Stadthalter  von  Heutl.  The  latter  specially  favors  compulsory  arbi- 
tration, expressing  the  belief  that  the  activity  of  a  court  of  compulsory 
arbitration  and  the  precedents  created  by  the  same,  might  be  instru- 
mental in  effecting  and  maintaining  industrial  peace. 

On  the  other  hand,  however,  I  found  that  Austrian  employers  and 
employees,  as  a  rule,  are  much  opposed  to  compulsory  arbitration. 
Austrian  employers  are  opposed  not  only  to  compulsory  arbitration,  but 
to  interference  of  any  sort  in  labor  disputes  on  the  part  of  the  State, 
on  the  grounds— 

a.  That  the  State  officials  are  likely  to  be  in  sympathy  with  labor, 
and  are  likely  to  use  their  influence  to  get  concessions  in  favor  of  labor, 
in  order  to  least  inconvenience  themselves  and  in  the  interest  of  indus- 
trial peace. 

&.  Because  compulsory  arbitration  in  time  of  industrial  disputes 
would  compel  the  employer  to  expose  in  court  his  private  affairs  for 
the  information  of  the  court  and  at  the  same  time  also  for  the  informa- 
tion of  watchful  competitors,  while  labor  on  the  other  hand  would 
stand  simply  on  its  demands. 

c.  Because  compulsory  arbitration,  the  employers  claim,  would  rob 
them  of  their  liberty,  and  would  compel  them  to  accept  the  dictates  of 
perhaps  a  hostile  court. 

Austrian  labor  is  opposed  to  compulsory  arbitration— 

a.  Because  it  fears  that  capital  with  its  tremendous  power  would 

intimidate  the  arbitration  courts ;  and 

fr.  Because  compulsory  arbitration  would  rob  labor  of  the  right  to 

strike,  which  it  regards  as  its  most  formidable  weapon,  and  which  it 

will  not  surrender  under  any  conditions. 


24  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

Labor  declares  further  by  its  representative,  Hueber  Broun,  editor 
of  the  Arbeiter  Zeitung,  the  Social  Democratic  paper  of  Vienna,  and 
Representatives  Beer,  Hannsch,  and  Schrammel,  members  of  the  Lower 
Austrian  House,  that  it  would  combat  any  attempt  to  deprive  it  by 
law  of  the  power  to  strike  and  would  employ  all  means  at  its  command, 
resorting,  if  necessary,  to  the  extreme  of  fighting  therefor  in  the  very 
streets. 

Professor  Kobatsch,  a  recognized  authority  on  economic  and  labor 
questions  of  Austria,  maintains  that  compulsory  arbitration  can  not 
be  adapted  to  the  economic  and  social  conditions  of  Continental  Europe, 
and  that  even  in  England,  the  most  progressive  industrial  country  of 
Europe,  the  proposal  was  recently  rejected  with  the  enormous  majority 
of  660,000  votes. 

STRIKE  REMEDIES. 

The  consensus  of  opinion  in  Austria  on  the  part  of  officials,  employ- 
ers, and  labor  leaders  is  that  the  best  remedies  against  strikes  and 
lockouts  are— 

a.  Organizations  on  both  sides,  as  powerful  as  they  can  be  made,  on 
the  theory  that  mutually  strong  organizations  with  the  power  to  inflict, 
.if  need  be,  great  punishment  on  the  opposing  side,  will  tend  to  greater 
mutual  respect  and  to  greater  mutual  restraint. 

b.  On  the  part  of  labor  leaders,  it  is  held  that  the  recognition  of  labor 
unions  and  collective  bargaining  makes  for  greater  industrial  peace. 

c.  The  bringing  together  of  the  conflicting  parties  for  the  purpose 
of  reaching  a  better  mutual  understanding. 

d.  The  making  of  long  contracts,  say  from  three  to  five  years,  between 
employers  and  employees  in  order  to  establish  a  condition  of  steadiness 
and  to  enable  employers  safely  to  plan  for  the  growth  and  development 
of  their  business. 

The  feeling  seems  to  be  growing  in  Austria,  especially  in  labor 
circles,  that  more  is  to  be  gained  by  peaceful  measures  in  labor  disputes 
than  by  strikes  and  lockouts,  and  the  present  labor  tendency  is  to  leave 
nothing  undone  to  maintain  peace  before  the  extreme  measure  is 
resorted  to  of  declaring  a  strike. 


GERMANY. 


25 


GERMANY. 


Germany  in  the  past  two  or  more  decades  has  made  tremendous 
industrial  strides.  Since  the  introduction  of  technical  schools  some 
twenty  years  ago,  and  coincident  with  the  introduction  of  a  State  pro- 
tective trade  policy  and  a  more  paternal  State  interest  in  the  welfare  of 
its  working  people,  Germany  has  grown  to  be  the  greatest  Continental 
industrial  producer  and  a  keen  and  steadily  growing  competitor  to 
Great  Britain  in  the  markets  of  the  world. 

By  virtue  of  the  splendid  training  the  German  workman  receives  in 
his  elementary  and  technical  schools,  to  say  nothing  of  the  discipline 
he  undergoes  in  his  three  years'  compulsory  army  service,  his  standard 
of  efficiency  has  been  materially  raised  and  he  makes  a  far  more  capable 
and  intelligent  workman  than  did  his  father  or  his  grandfather.  These 
qualities,  together  with  the  fact  that  though  all  German  workmen  drink 
beer,  and  some  of  them  consume  a  great  deal  of  it,  few,  if  any,  get 
drunk,  and  from  the  further  fact  that  few.  if  any,  German  workmen 
are  addicted  to  the  vice  of  gambling,  enable  him.  despite  his  compara- 
tively small  earnings,  to  show  a  good  bank  account. 

CONDITION  OP  GERMAN  WAGE-EARNERS. 

While  the  average  earnings  of  the  German  workman  are  not  more 
than  half  the  earnings  of  the  wage-earner  in  the  United  States,  there 
is  a  marked  absence  of  the  extreme  poverty  that  greets  the  eye  in  British 
or  American  cities.  There  are  no  slums  to  be  found  in  the  cities  of 
Germany.  Nor  are  there  to  be  found  city  districts  where  are  to  be 
seen  the  so-called  submerged  tenth.  Even  the  poorest  quarters  of  the 
German  cities  are  kept  scrupulously  clean,  the  tenements  outwardly 
present  an  attractive  appearance,  and  inwardly,  as  a  rule,  will  bear  a 
searchlight  inspection.  This  is  not  only  due  to  the  absence  of  drunken- 
ness on  the  part  of  the  wage-worker,  but  also  to  the  deep  and  sincere 
interest  manifested  on  the  part  of  the  authorities  in  the  physical  well 
being  of  the  working  classes. 

EFFICIENCY  OF  GERMAN  PUBLIC  OFFICIALS. 

Unlike  our  American  cities,  burgomeisters  (mayors)  and  city  officials 
are  specially  trained  for  their  work  and  render  the  highest  quality  of 
efficiency.  Moreover,  such  a  thing  as  municipal  graft  is  unknown  in 
Germany. 


26  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

The  Germans  can  not  understand  what  seems  to  them  a  paradoxical 
condition  in  our  country.  They  ask,  "How  is  it  that  individually  you 
Americans,  as  a  rule,  are  the  soul  of  honor,  yet  collectively  in  your 
municipal  administrations  you  seem  to  be  a  pack  of  thieves  ? ' ' 

In  consequence  of  the  efficiency  of  the  German  municipal  officials  and 
the  absence  of  municipal  graft,  Germany  has  the  best  governed  and 
the  best  kept  cities  in  the  world.  The  German  taxpayer,  as  a  rule,  gets 
a  hundred  cents  worth  on  the  dollar  in  municipal  service  and  in  munic- 
ipal conditions,  as  illustrated  in  a  measure  by  the  following  statement 
taken  from  a  recent  issue  of  the  Berliner  Lokal-Anzeiger: 

At  a  sitting  of  the  Berlin  municipal  council  held  on  Friday,  Dr.  Steiniger,  the 
city  chamberlain,  announced  that  the  financial  year  had  closed  with  the  substantial 
surplus  of  ten  and  a  half  million  marks. 

Direct  taxation  has  brought  4,300,000  marks  more  than  the  estimates.  Econ- 
omies and  increased  revenue  from  the  City  Loan  Department  realized  1,500,000 
marks.  The  carrying  out  of  public  works  had  been  accomplished  for  2,500,000  marks 
less  than  had  been  anticipated. 

There  are  yet  other  reasons  why,  despite  the  fact  that  the  average 
earnings  of  the  unskilled  workman  do  not  exceed  $5.50  per  week  and 
the  skilled  workman  $7.00  per  week  the  year  round,  that  he  can,  as  a 
rule,  keep  a  savings  bank  account. 

A  German  workman  occupies  for  himself  and  family  but  one  room 
and  kitchen  for  which  he  pays  a  rental  of  about  $6.00  a  month,  which 
is  less  than  half  the  rental  paid,  as  a  rule,  by  the  workman  in  our 
American  cities.  His  wife  is  often  also  a  breadwinner,  and  if  his 
children  are  over  fourteen,  they  likewise  as  breadwinners  add  to  the 
family  income.  In  addition  to  all  this,  the  paternal  form  of  govern- 
ment exercised  by  Germany  makes  provision  for  the  care  of  the  wage- 
earner  and  his  family  in  the  event  of  sickness,  permanent  infirmity, 
accident  or  old  age. 

GOVERNMENTAL  PATERNALISM. 

Perhaps  the  greatest  of  all  the  great  achievements  of  Bismarck  was 
the  founding  of  the  sick,  the  accident  and  the  old  age  pension  funds 
which  he  initiated.  One  reason  why  so  few  beggars  are  to  be  seen  in 
Germany  is  because  the  sick  and  the  old  are  well  cared  for.  And  this 
is  done  in  a  way  not  to  destroy  the  self-respect  of  the  man.  He  is  in  no 
way  pauperized  by  being  given  what  may  be  termed  uncharitable 
charity.  He  himself  must  contribute  in  the  days  of  his  health  and 
strength  to  the  creation  of  a  fund  that  in  the  days  of  sickness  and  old 
age  will  place  him  beyond  the  need  of  charity,  and  insure  him  the 
best  medical  treatment  for  his  physical  ailments  and  a  roof  over  his 
head  when  his  days  of  physical  usefulness  are  over.  All  this  is  accom- 
plished at  so  trifling  a  tax  upon  him  that  he  scarcely  feels  it.  The  lowest 
paid  wage-earner  contributes  to  this  fund  less  than  two  cents  a  week  and 


GERMANY.  27 

the  highest  paid  wage-earner  pays  a  little  less  than  five  cents  a  week. 
Equivalent  amounts  are  also  paid  into  the  fund  by  the  employers  as 
their  contribution  to  the  sick  and  pension  fund  for  employees. 

These  trifling  payments  afford  an  annual  income  for  the  city  of  Berlin 
alone,  to  say  nothing  of  the  rest  of  the  empire,  of  $2,500,000,  not  includ- 
ing a  further  income  of  about  $500,000  interest  on  the  reserve  fund  of 
$18,500,000  which  has  been  accumulated  since  its  creation.  The  reserve 
sick  and  pension  fund  for  Germany  as  a  whole  is  over  $375,000,000,  and 
the  fund  is  scarcely  more  than  eighteen  years  old. 

Out  of  such  funds  have  been  erected  for  the  exclusive  use  of  working- 
men,  some  of  the  finest  sanatoriums  in  the  world.  In  fact,  the  sana- 
torium for  the  workingmen  of  Berlin,  located  in  a  magnificent  forest 
about  an  hour 's  ride  from  the  city,  is  regarded  as  the  finest  in  the  world, 
and  accommodates  twelve  hundred  patients.  The  German  workingman 
feels  that  these  sanatoriums  are  his,  built  partly  with  his  own  contribu- 
tions, and  that  it  can  no  longer  be  said  that  only  the  rich  can  enjoy  the 
comforts  and  the  blessings  afforded  by  these  modern  institutions  for  the 
sick.  In  addition  to  being  cared  for  at  these  superb  sanatoriums  where 
the  highest  medical  skill  is  employed,  the  family  of  the  sick  workman,  as 
long  as  he  is  an  indoor  patient,  is  assisted  out  of  the  insurance  fund,  in 
amounts,  according  to  the  contribution  that  he  has  made  to  the  imperial 
insurance  fund,  equivalent  to  from  one  quarter  to  three  quarters  of  his 
full  wages.  In  the  city  of  Berlin  alone  there  are  five  hundred  thousand 
persons  who  contribute  to  the  imperial  insurance  fund.  Berlin  alone 
now  has  over  two  thousand  workers  over  seventy  years  of  age  who  are  in 
receipt  of  old  age  pensions  and  about  twenty-five  thousand  persons  who 
receive  infirmity  pensions. 

The  total  number  of  workers  insured  in  the  German  empire  as  far 
back  as  1903  was  10,914,333. 

The  apprehension  that  the  sick  and  old  age  pensions  in  Germany 
would  paralyze  the  spirit  of  thrift,  predicted  by  those  who  in  the  begin- 
ning opposed  the  measure,  has  not  been  realized,  as  shown,  for  example, 
by  the  colossal  increase  in  the  German  savings  banks  deposits  from  1894 
to  1904.  In  1894  the  savings  deposits  in  Germany  were  $980,556,375. 
In  1904  they  were  $1,902,436,560,  nearly  double. 

As  pointed  out  by  a  recent  writer : 

It  is  held  in  Germany  that  the  state  does  not  exist  merely  to  afford  protection 
to  the  better  situated,  but  also  to  watch  over  and  to  administer  to  the  requirements 
of  the  working  classes.  The  first  step  taken  was  to  ward  off  the  weight  of  the 
consequences  accruing  from  accidents  and  sickness,  and  the  result  of  the  labor  in  this 
direction  was  the  passing  of  the  workman's  sickness  insurance  and  the  workman's 
accident  insurance  bills. 

The  German  government  is  unceasingly  occupied  with  the  problem  of  providing 
for  the  comfort  and  well  being  of  the  sixty  million  Germans  now  living  in  Germany 
and  is  not  leaving  to  succeeding  generations  unaided,  the  task  of  continuing  the 
solution  of  this  problem. 


28  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

In  addition  to  the  provisions  made  by  the  government  for  the  well- 
being  of  its  working  people,  many  employers  voluntarily  cooperate. 
They  not  only  pay  into  the  state  insurance  funds  the  amounts  required 
by  law.  but  many,  especially  among  the  large  employers,  have  private 
pension  funds,  and  have  erected  model  workingmen's  dwelling  houses, 
workingmen's  free  libraries  and  bathing  houses.  Thus,  do  we  find  the 
State,  the  employers,  and  the  employees  cooperating  together  for  fur- 
ther industrial  progress  and  advancement. 

While  the  provisions  against  sickness  and  old  age  have  in  nowise 
lessened  disputes  between  capital  and  labor,  they  have  nevertheless 
bettered  the  conditions  of  wage-earners  and  insured  them  in  case  of  old 
age,  sickness,  or  misfortune  from  becoming  objects  of  charity. 

On  the  other  hand,  as  stated  in  his  recent  report  by  American  Consul 
Harris  of  Chemnitz : 

Experience  has  shown  in  Germany  as  elsewhere,  that  the  more  the  manufacturer 
learns  to  differentiate  between  a  man  and  a  machine,  the  more  he  is  likely  to  reduce 
the  danger  of  strikes. 

In  her  sincere  interest  in  the  welfare  of  the  working  people,  Germany 
has  given  the  world  a  great  object  lesson  by  which  others  nations  are 
sure  to  profit.  Austria  now  has  under  advisement  an  old  age  pension 
act,  and  the  latest  advices  from  England  tell  that  Parliament  has  just 
passed  an  old  age  pension  bill. 

I  venture  the  prediction  that  the  day  is  not  far  distant  when  the 
United  States  will  likewise  see  the  wisdom  of  insuring  its  work  people 
against  sickness  and  old  age,  thus  minimizing  much  misery  and  suffer- 
ing, to  say  nothing  of  saving  the  great  waste  ever  going  on  in  the  way  of 
duplicated  and  mismanaged  private  American  charities  supported  for 
the  relief  of  the  sick  and  the  old. 

The  possible  argument  that  we  do  not  want  paternalism  in  our 
government  will  in  my  opinion  not  hold  in  this  connection,  for  the 
reason  that,  in  a  measure,  we  are  already  paternalistic,  as  evidenced  by 
our  free  dispensaries  and  free  county  hospitals,  which,  however,  tend 
to  pauperize  because  they  are  conducted  in  the  nature  of  public 
charities.  The  compulsory  contributions  made  by  German  employers 
and  employees  removes  the  thought  in  Germany  that  the  recipient  is  an 
object  of  charity. 

WAGES  AND  COST  OF  LIVING. 

As  elsewhere  in  Europe,  the  tendency  of  German  wages  in  recent 
years  has  been  upward  until  checked  by  the  recent  depression,  which 
has  been  keenly  felt  in  the  industries  of  Germany.  The  cost  of  living, 
however,  has  also  progressively  increased,  but  not  as  much  as  the  rise 


m  wages. 


GERMANY.  29 

LABOR  ORGANIZATIONS. 

Organization  has  gone  forward  with  rapid  strides  in  recent  years 
among  employers  as  well  as  among  employees.  The  organization  which 
corresponds  with  the  American  Federation  of  Labor  now  numbers 
1,888,000  members,  and  is  still  growing. 

In  common  with  the  Austrian  wage-earner  the  workingmen  of 
Germany  take  an  active  interest  in  politics,  and  under  the  title  of 
"Social  Democrats"  wield  considerable  political  power. 

Because  of  the  fact  that  the  government  is  anti-socialistic,  and  because 
of  the  further  fact  that  the  labor  unions  and  the  Social  Democratic 
party  are  composed  practically  of  the  same  membership,  the  government 
is  not  very  friendly  to  labor  unions.  The  government  at  times  has 
shown  its  hostile  spirit  toward  labor  unionism,  but  thus  far  has  not  been 
able  to  cripple  labor  organizations  by  the  passing  of  unfriendly  legis- 
lation. 

While  many  of  the  smaller  employers,  as  well  as  the  employers  in 
the  printing,  bookbinding  and  building  trades,  have  been  compelled  to 
recognize  the  unions,  the  great  German  employers  of  labor,  including 
the  employers  in  the  coal,  the  metal  and  the  textile  industries,  have 
steadily  and  persistently  refused  to  deal  with  or  to  recognize  unionism. 
Employers  in  these  industries,  with  three  million  wage-earners  on  their 
aggregate  pay  rolls,  are  strongly  organized  and  persistently  refuse  to 
deal  with  or  to  recognize  labor  organizations.  They  contend  that  union 
wage-earners,  as  a  rule,  are  also  members  of  the  Social  Democratic 
party,  which  has  persistently  and  needlessly  antagonized  capital  and 
capitalists,  and  that  so  long  as  this  condition  prevails  they  will  refuse  to 
recognize  unionism.  Exceptional  cases  are  found  where  large  employ- 
ers will  recognize  unions  composed  of  .their  own  workmen.  For  example, 
Messrs.  D.  Peters  &  Co.  of  Elberfeld,  manufacturers  of  woolen  and  cot- 
ton stuffs,  have  a  council  composed  of  nine  employees,  four  of  whom  are 
nominated  by  the  employers  and  five  are  elected  by  the  workmen,  with 
a  member  of  the  firm  as  president,  who,  however,  has  no  vote.  All  differ- 
ences arising  in  relation  to  hours  of  labor  or  wages  are  referred  to  this 
council,  whose  decisions  have  ever  been  accepted  by  both  parties.  This 
plan  seems  to  have  worked  to  the  satisfaction  of  all  concerned. 

STATE  INTERVENTION  IN  LABOR  DISPUTES. 

The  State  has  thus  far  refrained  from  even  attempting  to  exercise  any 
coercion  in  forcing  settlements  in  labor  disputes.  It  is  a  strong  believer, 
however,  in  the  exercise  of  conciliatory  measures.  With  this  end  in 
view  a  law  went  into  effect  in  1907,  creating  what  has  since  become 
known  as  the  arbitration  courts  for  trade  disputes.  There  are  between 
four  hundred  and  four  hundred  and  fifty  such  courts  throughout  Ger- 


30  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

many.    The  court  in  Berlin  has  eight  departments  with  a  judge  for  each 
department.     These  courts  have  three  separate  and  distinct  functions: 

a.  To  decide  disputes  between  individual  workmen  and  their  em- 
ployers. 

b.  To  conciliate  in   disputes   between   bodies   of   workers  and  their 
employers. 

c.  To  give  expert  information  and  opinions,  in  reference  to  trade 
questions  to  legislators  and  to  state  executives. 

Under  the  law  the  court  awaits  the  registering  of  a  complaint  by  either 
party  to  a  trade  dispute,  but  it  also  has  the  power  to  take  the  initiative 
and  to  summon  both  parties  to  a  hearing,  subject  to  a  fine  of  twenty-five 
dollars  for  failure  to  respond  to  such  summons. 

There  is  no  penalty  for  either  side  refusing  to  answer  questions  put 
by  the  court  or  for  refusing  to  enter  into  negotiations  with  the  other 
party,  even  at  the  instance  of  the  court. 

The  theory  of  the  law  is  that  one  half  the  battle  in  a  labor  dispute  is 
won  in  the  direction  of  peace  if  both  parties  can  be  brought  together 
by  a  third  party,  who  in  this  instance  is  the  court,  who  is  disinterested 
and  in  whom  both  sides  can  place  confidence. 

I  was  informed  by  Herr  Gustav  Melisch,  Chief  Secretary  of  the  Indus- 
trial Court  of  Berlin,  that  seventy  per  cent  of  the  disputes  are  submitted 
to  this  court  and  that  as  a  rule  the  decisions  rendered  are  accepted, 
although  under  the  law  there  is  no  obligation  to  do  so,  but  that  most  cases 
are  settled  by  compromises  effected  between  the  parties  in  dispute, 
while  the  case  is  in  course  of  investigation  and  prior  to  the  court  decision. 

Herr  Melisch  made  the  further  statement  that  mutual  deference  and 
respect  is  shown  in  the  discussions  of  labor  questions  before  the  court 
between  the  representatives  of  employers  and  employed,  and  that  the 
labor  contracts  frequently  resulting  from  these  court  investigations, 
some  of  them  for  a  period  of  three  to  five  years,  are  mutually  respected. 

STANDING  OF  GERMAN  LABOR  LEADERS. 

Herr  Melisch  took  occasion  to  speak  in  high  terms  of  the  German 
labor  leaders  with  whom  his  official  duties  have  brought  him  into  con- 
tact. He  spoke  of  them  as  being  men  of  the  highest  integrity  and  char- 
acter, and  as  being  universally  respected  even  by  large  empk^ers  whose 
policy  it  is  not  officially  to  recognize  them. 

ATTITUDE  OF  EMPLOYERS  TOWARD  STATE  INTERVENTION. 

The  large  employers  of  labor  as  a  rule  will  not  recognize  this  court  of 
arbitration  and  conciliation,  and  its  labors  generally  have  been  thus 
confined  almost  wholly  to  minor  employers  and  to  individual  cases.  An 
exceptional  case  happened  recently,  however,  which  was  in  the  nature  of 
a  great  stroke  of  good  work  on  the  part  of  the  court.  A  national  strike  in 


GERMANY.  31 

the  building  trades  was  threatened  throughout  Germany.  Through  the 
efforts  of  this  court  a  hearing  was  held  at  which  representative  building 
contractors  and  wage-earners  from  various  parts  of  Germany  were  pres- 
ent. The  conference  continued  for  many  days,  and  finally,  through  the 
good  offices  of  the  court,  mutual  concessions  were  made  and  an  agree- 
ment for  a  period  of  years  entered  into,  which  insures  industrial  peace  • 
in  the  building  trades  for  a  long  time  to  come. 

OPEN  SHOP. 

Excepting  in  the  printing  trades,  the  open  shop  prevails  throughout 
Germany,  though  in  many  shops  where  the  great  majority  are  union 
workers  it  is  said  that  life  by  them  is  made  a  burden  to  the  nonunion 
worker. 

COMPULSORY  ARBITRATION. 

I  find  that  in  Germany,  as  in  Austria,  employers  and  employees,  as  a 
rule,  are  opposed  to  compulsory  arbitration.  Official  Germany  seems 
likewise  opposed  to  compulsory  arbitration. 

Herr  Delbruck,  Minister  of  Commerce  and  Labor,  made  the  statement 
that  the  State  does  not  favor  compulsory  arbitration  for  fear  that  it 
might  find  itself  unable  to  enforce  its  decisions,  and  that  a  failure  to  do 
so  would  bring  the  administration  into  contempt. 

German  labor  leaders  are  opposed  to  compulsory  arbitration  on  the 
grounds  that  they  feel  that  the  State  is  not  in  sympathy  with  labor 
unionism,  and  that  therefore  the  leanings  of  a  compulsory  court  would 
most  likely  be  toward  the  interests  of  the  employers. 

Nor  are  labor  leaders  here  in  favor  of  labor  unions  becoming  incor- 
porated for  fear  of  .being  legally  harassed  by  employers'  associations. 

German  employers,  as  a  rule,  oppose  compulsory  arbitration  because 
they  want  the  State  to  keep  hands  off  from  their  disputes  with  labor, 
believing  as  they  do  that  in  the  end  they  can  get  better  results  and  secure 
better  terms  for  themselves  without  State  interference. 

CHAMBERS  OF  LABOR. 

His  Excellency  Delbruck,  the  Minister  of  Commerce,  stated  that  the 
draft  of  a  law  is  under  consideration  regarding  so-called  ' '  Chambers  of 
Labor."  These  chambers  of  labor  are  to  serve  as  courts  of  arbitration 
wherever  special  arbitration  courts  for  trade  disputes  do  not  exist,  or  if 
the  employers  and  employees  are  engaged  in  the  districts  of  several 
existing  arbitration  courts,  or  if  no  agreement  can  be  reached  concerning 
a  dispute  in  the  ordinary  court  for  trade  disputes. 

The  composition  for  the  proposed  labor  councils,  their  functions  and 
powers,  have  not  yet  been  fully  determined  upon,  beyond  the  general 
idea  that  they  are  to  be  composed  partly  of  employers  and  partly  of 
employees. 


32  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

TAXES. 

By  permission  of  American  Vice-Consul  General  Charles  A.  Kisdorf 
of  Frankfurt,  Germany,  I  include  the  following  statement  in  this  report 
as  showing  the  burden  of  taxes  imposed  by  the  several  countries  named 
therein  on  their  respective  consumers : 

FOOD  TAXATION  IN  THE  UNITED  KINGDOM,  FEANCE,  GEBMANY,  AND  THE  UNITED  STATES. 

In  view  of  the  various  projects  of  taxation  in  Germany,  an  essay  with  the  above 
title  by  S.  Rosenbaum  seems  worthy  of  interest.  The  author  examined  into  the 
duties  on  groceries,  sugar,  tobacco  and  food  of  all  kinds  and  the  internal  taxation 
on  liquors,  tobacco  and  food  in  the  several  states,  and  comes  to  the  following  results : 

The  burden  of  taxation  is  shown  in  the  following  schedule,  the  figures  meaning 
dollars  per  capita  of  the  population — 

United  United 

Kingdom.        France.       Germany.       States. 

1870 $6  35  $3  60           $4  55 

1875 6  55  5  01  $1  45  3  59 

1880 . 5  92  5  60  1  79  3  54 

1885 6  07  5  59  2  58  3  40 

1890 5  92  5  97  3  40  3  74 

1895 6  02  6  22  3  01  2  77 

1900 6  85  6  50  3  54  4  61 

1903 7  82  6  22  3  54  4  28 

1906 7  29  6  17  3  79  4  27 

This  table,  covering  a  period  of  thirty-six  years,  shows  interesting  details.  Thus, 
in  America,  the  burden  of  taxation  has  decreased;  the  Americans  now  pay  less  per 
capita  than  in  the  year  1870.  The  development  in  England  is  quite  similar,  but  it 
has  been  disturbed  by  the  financial  effects  of  the  war  in  Transvaal.  Even  so  the 
increase  is  moderate  in  this  country  of  free  trade. 

Quite  different  results  are  shown  in  France  and  Germany,  where  the  military 
preparations  have  been  multiplied  since  1871.  In  France  this  taxation  has  increased 
about  one  hundred  per  cent,  and  in  Germany  also  there  is  a  rapid  rise.  These  figures 
form  a  good  argument  for  the  friends  of  peace. 

The  author  also  calculates  the  amount  of  taxes  derived  from  food,  liquors  and 
tobacco  in  different  countries. 

Food  and 

Groceries.      Liquors.       Tobacco. 

England $1  58  $4  22  $1  50  per  capita. 

France 1  99  2  28  1  84  per  capita. 

Germany 2  38  1  07  34  per  capita. 

United  States _ 83  2  58  87  per  capita. 

According  to  this  schedule,  the  taxes  on  food  are  higher  in  Germany  than  in  any 
other  state.  Still  there  is  a  fault  in  this  calculation :  only  the  revenue  is  taken 
into  consideration  and  no  allowance  is  made  for  the  increase  in  prices  of  domestic 
products  caused  by  high  customhouse  duties.  The  amount  of  duty  collected  for  corn 
does  not  show  the  real  burden  of  taxation  resting  on  the  population ;  the  entire 
consumption  of  corn  should  be  taken  into  consideration,  and  then  we  find  quite 
different  results  in  France  and  Germany,  and  even  more  benefit  to  England  and 
America.  It  must  also  be  borne  in  mind  that  Germany  is  a  federal  state,  and  that 
the  states,  countries,  and  communities  frequently  impose  taxes  on  meat,  beer,  bread, 
etc.,  which  are  not  included  in  this  calculation. 


BELGIUM.  33 


BELGIUM. 


Though  one  of  the  smallest  nations  in  Europe,  Belgium  per  capita 
is  the  greatest  industrial  country  in  the  world.  With  a  population  of 
•only  seven  millions,  it  does  a  foreign  import  and  export  business 
aggregating  $14,000,000,000.  Its  industrial  army  numbers  1,500,000 
«ouls,  and  is  steadily  growing.  Over  sixty  per  cent  of  all  its  manual 
workers  are  engaged  in  industrial  pursuits,  which  are  the  main  support 
•of  the  nation. 

Unlike  the  German  and  Austrian  workers,  strong  drink  has  a  grip  on 
the  wage-earner  of  Belgium.  As  a  consequence,  slums  are  to  be  found 
in  its  larger  industrial  centers,  more  especially  in  Brussels,  where  the 
lower  order  of  wage-earners  are  more  or  less  dissolute  and  thriftless. 
Many  parents  among  them  spend  their  week's  earnings  in  drink  and 
permit  their  children  to  go  neglected  and  uncared  for. 

There  is  also  much  illegitimacy  among  this  element  of  the  population. 
The  interesting  feature  in  this  connection,  however,  lies  in  the  fact  that 
as  a  rule  these  children  are  later  legitimatized  by  marriage. 

The  Belgium  nation  is  composed  partly  of  French  and  partly  of 
Flemish.  A  goodly  part  of  what  is  now  known  as  Belgium  came  under 
the  dominion  of  Holland  and  the  remainder  under  France  prior  to  1830, 
when  the  kingdom  was  brought  into  independent  existence. 

The  Flemish  wage-earners  are  hardworking,  but  stolid  and  obstinate ; 
fully  half  of  them  are  illiterate  and  largely  governed  by  the  priesthood. 
The  French  workman,  who  represents  nearly  two  thirds  of  the  industrial 
force  of  Belgium,  on  the  other  hand  is  exceedingly  bright  and  clever. 

LABOR  UNIONS. 

The  Belgium  labor  unions  have,  many  of  them,  established  for  them- 
selves the  reputation  of  being  contract  breakers.  This  has  done  much  to 
destroy  the  confidence  of  employers  in  them  and  has  greatly  added  to  the 
normal  difficulty  usually  experienced  by  labor  unions  the  world  over,  in 
getting  recognition  from  employers. 

Labor  leaders  in  Belgium  have  become  awake  to  this  fact,  and  some 
the  central  labor  organizations  have  adopted  the  German  system  of 
withholding  support  from  such  local  unions  as  violate  their  contracts 
with  employers. 
3 


34  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

WAGES. 

The  general  tendency  of  wages  has  been  upwards.  For  example,  the 
increase  in  wages  of  textile  workers  has  been  about  twenty  per  cent.  In 
the  iron  trades  the  increase  in  wages  during  the  past  ten  years  has  been 
from  thirty  to  forty  per  cent.  Despite  all  this,  the  wage  standard  of 
Belgium  is  lower  than  that  of  most  other  European  industrial  countries. 
To  illustrate  this,  in  Brussels,  where  wages,  generally,  are  the  highest 
in  Belgium,  skilled  workers,  as  a  rule,  earn  an  average  of  eighty  cents  a 
day,  and  unskilled  workers  an  average  of  sixty  cents  a  day. 

In  the  iron  industries  the  rate  is  somewhat  higher,  skilled  workmen 
averaging  ninety  cents  a  day,  and  unskilled  seventy  cents  a  day. 

Street  car  employees  in  Brussels  earn  a  minimum  of  sixty-five  cents  a 
day,  and  after  several  years'  service  a  maximum  of  ninety  cents  a  day, 
with  a  small  pension  after  twenty  years '  service. 

Saleswomen  employed  in  the  great  cooperative  department  store  of 
Brussels,  which  claims  to  pay  higher  wages  than  its  noncooperative  com- 
petitors, earn  at  the  start  $1.50  a  week  and  after  three  months'  service 
$2.25  a  week,  with  an  increase  of  $2.50  a  month  for  every  two  years ' 
additional  service  until  a  maximum  wage  is  reached  of  $6.70  a  week; 
this,  after  a  service  of  fourteen  years. 

A  male  head  of  department  in  this  same  enterprise,  which  position 
carries  with  it  much  responsibility  and  demands  years  of  training,  earns- 
about  $11.00  a  week. 

Despite  the  advance  in  Belgium  wages  during  the  past  several  years, 
the  wage  standard  of  Belgium  is  lower  than  that  of  France  and  other 
European  countries.  I  was  informed  by  a  manufacturer  who  has  a 
large  plant  in  Belgium  and  one  also  in  France,  that  his  Belgium  wage 
rate  was  thirty-five  to  forty  per  cent  lower  than  that  paid  by  him  in 
France. 

Belgian  employers  successfully  fight  foreign  competition  with  low 
wages.  Collective  wage  bargaining  is  rarely  met  with  in  Belgium. 
Aside  from  the  building  trades,  where  a  minimum  wage  is  fixed  by  the 
trade,  the  bargaining  between  employer  and  employee,  as  a  rule,  i& 
individual. 

COST  OF  LIVING. 

The  cost  of  living  during  the  past  several  years  has  steadily  been 
upwrard.  The  consensus  of  opinion  among  those  who  have  made  inves- 
tigations along  these  lines  is  that  the  increased  cost  of  living  is  fully 
twenty-five  per  cent.  Nevertheless,  it  is  maintained  that  food  products 
are  cheaper  than  in  France  or  elsewhere  on  the  Continent,  due  to  the 
fact  that,  aside  from  customs'  duties  placed  on  a  few  luxuries,  Belgium 
is  practically  a  free  trade  country. 


BELGIUM.  35 

GROWTH  OF  UNIONISM. 

Labor  unionism  presents  a  steady  and  constant  growth.  Organized 
labor  now  has  a  membership  of  about  300,000. 

Some  of  the  industries  are  better  organized  than  others.  The  best 
organized  industries  are  the  building  trades,  the  textile  industries,  and 
the  iron  workers. 

Belgian  union  labor  is  divided  into  two  main  camps,  the  Socialists 
and  the  Christian  Labor  party.  The  former  represents  about  ninety 
per  cent  of  organized  labor,  and  the  latter  about  ten  per  cent. 

To  quote  the  statement  made  by  the  secretary  of  the  Christian  Labor 
party:  'The  socialistic  labor  unions  stand  for  anti-capitalism,  col- 
lectivism and  aggressiveness  in  dealing  with  employers;  the  Christian 
Labor  party  stands  for  individualism,  conciliation  and  arbitration  in 
labor  disputes." 

The  Christian  Labor  party  is  five  years  old,  and  now  numbers  between 
thirty  and  forty  thousand  members.  During  that  period,  according  to 
the  statement  of  its  secretary,  it  has  had  twelve  labor  disputes,  all  of 
which  were  settled  by  arbitration.  It  has  yet  to  deal  with  its  first  strike. 

The  Socialist  Labor  members  are  commonly  knowrn  as  the  "Beds" 
and  the  Christian  Labor  members  as  the  ' '  Yellows. ' '  Many  among  the 
Socialists  claim  that  the  Christian  Labor  party  is  fathered  by  the 
Catholic  Church  and  by  the  employers,  both  of  whom  are  regarded  by 
the  Socialistic  members  as  enemies  to  socialism. 

The  feeling  between  the  "Reds"  and  the  "Yellows"  is  more  or  less 
unfriendly,  if  not  bitter.  As  a  consequence,  when  "Reds"  and 
"Yellows"  are  thrown  together  on  the  same  job,  there  is  friction.  The 
;'Reds"  will  work  with  the  "Yellows"  only  when  compelled  to,  and 
then,  if  they  happen  to  be  in  the  majority,  things  are  often  made  most 
unpleasant  for  the  ' '  Yellows. ' '  While  there  are  few,  if  any,  employers 
who  will  recognize  the  ' '  Reds, ' '  there  are  many  who  will  recognize  and 
deal  with  the  "Yellows." 

Though  the  latter  represent  but  about  ten  per  cent  of  the  organized 
Belgian  labor  unionists,  it  is  claimed  by  them  that  they  are  steadily 
growing  in  strength,  and  that  in  a  few  years  they  will  outnumber  the 
'Reds."  The  "Reds"  seem  to  apprehend  this  and  support  a  literary 
bureau  for  the  express  purpose  of  controverting  the  claims  of  their 
rivals. 

Yet  another  marked  difference  in  the  policy  of  the  two  labor  factions 

that  the  "Reds"  believe  that  the  betterment  of  labor  conditions 

.ust  come  largely  through  political  effort.  Much  of  their  time  and 
energy  has  therefore  been  devoted  to  political  campaigning,  and  they 
now  have  a  showing  of  seven  members  in  the  Upper  House  and  thirty 
members  out  of  one  hundred  and  sixteen  in  the  lower  legislative  body 
of  the  realm. 


36  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

SUFFRAGE. 

The  "Reds"  are  making  an  heroic  effort  to  have  the  existing  law  of 
suffrage  changed,  which  provides  for  cumulative  votes ;  that  is,  all  males 
twenty-five  years  of  age  have  one  vote,  if  married  they  have  two  votes, 
and  if  also  taxpayers  they  have  three  votes.  This  provision  they  con- 
tend militates  against  the  wage-earner,  and  is  in  favor  of  the  class  who 
can  afford  to  marry  early  in  life  and  who  have  something  on  which  to 
pay  taxes.  The  ' '  Reds ' '  want  the  law  of  ' '  one  man,  one  vote, ' '  without 
further  qualification.  The  'Yellows,"  on  the  contrary,  are  firmly 
opposed  to  mixing  labor  problems  with  politics,  and  steadfastly  oppose 
such  action  on  the  part  of  their  membership. 

APPRENTICES. 

As  in  the  United  States,  the  Belgium  labor  unions  limit  the  number 
of  apprentices  to  be  admitted  to  any  one  trade.  This  policy  it  is 
claimed  by  President  Carlier  of  the  Brussels  Children's  Society  has 
tended  largely  to  increase  juvenile  criminality,  which  in  Belgium,  as 
elsewhere,  is  becoming  a  very  grave  problem.  An  effort  is  being  made 
to  meet  this  problem  by  the  establishing  of  technical  schools. 

RELATION  OF  EMPLOYERS  AND  MEN. 

The  relations  between  employers  and  employees  in  various  industries 
are  getting  more  strained.  Notable  exceptions  are  the  building  and  the 
iron  trades  where  the  relations  are  cordial.  There  has  not  been  a  strike 
in  the  iron  trade  for  thirteen  years. 

EMPLOYERS'  ASSOCIATIONS. 

The  Belgian  employers  have  many  and  varied  associations.  These, 
as  a  rule,  have  for  their  main  purpose  the  interchange  of  ideas  on  com- 
mercial questions.  No  systematic  plan  has  as  yet  been  adopted  by 
them  for  defense  against  strikes,  except  in  special  cases,  when  tem- 
porary organization  has  been  effected  to  meet  particular  cases.  The 
idea  of  organizing  to  meet  strikes  is  growing  and  will  probably 
crystallize  in  the  near  future.  Labor  leaders  express  satisfaction  at  the 
thought  of  employers  organizing  for  the  purpose  of  defense  measures 
against  strikes,  claiming  that  such  action  on  the  part  of  employers 
would  afford  stronger  ground  for  appeal  to  labor  to  organize  more 
widely. 

OPEN  SHOP. 

Aside  from  the  printing  and  diamond  cutting  trades,  "open  shop" 
prevails  throughout  Belgium,  although  in  the  glass  industry  it  is 
claimed  that  nonunion  workers  are  persecuted  by  unionists. 


BELGIUM.  37 

STRIKES. 

During  1907  strikes  were  more  frequent  in  Belgium  than  in  previous 
years,  but  since  the  depression  has  set  in,  from  which  Belgium  in  com- 
mon with  other  European  countries  is  suffering,  they  are  diminishing. 

Unionists  seem  to  hold  a  grievance  against  the  government  because 
of  its  policy  to  furnish  troops  in  anticipation  of  a  strike.  It  has  been 
noted  that  the  older  and  wealthier  unions  oppose  strikes,  while  the 
younger  and  financially  weak  unions  favor  them. 

It  was  interesting  to  get  the  views  of  various  labor  authorities  as  to 
the  best  remedy  against  strikes.  Mr.  Carlier,  a  large  coal  mine  owner, 
and  one  of  the  most  intelligent  employers  in  Belgium,  gave  it  as  his 
opinion  that  the  remedy  lies  in  higher  education  of  the  wage-earner, 
and  in  legislative  measures  that  will  establish  labor  union  responsibility 
for  the  protection  of  employers,  and  for  the  protection  of  such  other 
wage-earners  as  are  innocently  injured  by  senseless  and  needless  strikes. 
The  secretary  of  the  iron  workers'  union  gave  it  as  his  opinion  that  the 
remedy  for  strikes  lies  in  profit  sharing.  Minister  of  Labor  Hubert 
expressed  the  opinion  that  withholding  a  part  of  the  wages  as  a  guar- 
antee of  good  faith  tends  to  diminish  strikes,  and  pointed  out  that  in  the 
Belgium  glass  industry  employers  withhold  one  fifth  of  the  wage  with 
good  results.  The  secretary  of  the  Christian  Labor  party  believes  that 
arbitration  is  the  missing  link,  and  the  editor  of  a  leading  Belgian 
socialistic  paper  expressed  the  opinion  that  collective  contracts  of  from 
one  to  three  years  would  tend  to  make  strikes  much  more  infrequent. 

COMPULSORY    ARBITRATION. 

Nearly  every  one  interviewed  in  Belgium  seemed  opposed  to  com- 
pulsory arbitration  as  a  strike  remedy,  some  going  so  far  as  to  say 
that  to  take  away  from  the  wage-earner  the  right  to  strike,  which  would 
follow  under  compulsory  arbitration,  would  lead  to  endless  rioting  if  not 
to  open  rebellion. 

Wage-earners  opposed  compulsory  arbitration  on  the  grounds  that 
they  could  not  hope  for  a  fair  deal  at  the  hands  of  courts  who,  they 
believed,  as  a  rule,  are  in  sympathy  with  capitalistic  employers;  and 
employers  opposed  compulsory  arbitration  on  the  grounds  that  the 
State  should  keep  its  hands  off  labor  disputes,  and  partly  because  they 
did  not  believe  that  the  public  would  generally  stand  behind  and  sup- 
port the  court  decisions,  and  partly  because  they  did  not  believe  that 
the  court  decisions  could  be  enforced  against  a  great  body  of  workmen 
who,  as  a  rule,  would  accept  the  decisions  only  if  they  happened  to  be 
in  their  favor.  One  exception  to  this  point  of  view  was  Prof.  Emile 
Waxweiler,  Director  of  the  Solway  Institute  of  Sociology  in  Brussels, 
one  of  the  greatest  Belgian  authorities  on  questions  of  this  character. 


38  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

He  expressed  the  opinion  that  the  only  logical  and  ultimate  remedy  for 
strikes  and  lockouts  is  compulsory  arbitration,  and  that  it  was  only  a 
matter  of  time  when  society  would  find  itself  obliged  in  self-defense  to 
adopt  this  method  in  order  to  maintain  industrial  peace  and  to  prevent 
the  enormous  economic  losses,  to  say  nothing  of  the  physical  suffering 
and  misery  to  which  countless  innocent  people  are  subjected  by  strikes 
and  lockouts,  many  of  which  are  the  result  of  individual  self-seeking  or 
passion,  or  bad  judgment,  rather  than  a  desire  to  obtain  equity  and 
justice  for  the  many. 

The  organized  wage-earners  of  Ghent  who  number  about  fifteen  thou- 
sand, and  who  rank  among  the  most  intelligent  workmen  of  Belgium,  are 
another  exception.  This  was  the  first  organized  labor  body  that  I  had  met 
in  all  my  travels  through  Europe  which  is  in  favor  of  compulsory  arbi- 
tration. On  mentioning  this  to  the  secretary,  he  answered  that  the  Ghent 
wage-earners  had  for  years  carefully  followed  and  studied  the  labor 
struggles  of  the  British  wage-earner,  and  they  had  noted  that  despite  all 
the  losses  and  all  the  sacrifices  made  on  the  part  of  the  English  workman 
in  conducting  his  strikes,  he  was  not  much  better  off  than  he  was  in  the 
beginning,  and  that  the  conclusion  had  been  forced  on  the  Ghent 
workman  that  on  the  whole  the  strike  is  not  the  way  through  which 
the  wage-earner  can  hope  to  improve  his  condition,  that  the  losses 
he  suffers  often  more  than  offset  his  gains,  and  that  labor  disputes, 
like  civil  disputes,  should  be  settled  in  a  peaceful  manner  without  need- 
less loss  to  employer  or  employee.  Existing  conditions  and  general 
sentiment  in  Belgium  make  it  very  improbable  that  any  attempt  at  legis- 
lation having  compulsory  arbitration  for  its  end  is  likely  to  succeed. 
Professor  Waxweiler  and  the  Ghent  labor  unions  in  their  views  seem 
far  in  advance  of  the  ideas  of  the  rest  of  those  in  Belgium  who  are  inter- 
ested in  labor  problems.  Some  arbitration  legislation  is  contemplated 
and  is  likely  to  be  brought  before  the  Belgian  Parliament  at  an  early 
day,  but  so  far  as  I  could  learn,  the  proposed  arbitration  is  to  be  purely 
voluntary  in  character,  despite  the  fact  that  experience,  the  world  over, 
has  demonstrated  that  purely  voluntary  arbitration  for  the  settlement 
of  labor  disputes  has  been  a  failure. 


PRANCE.  39 


FRANCE. 


The  organization  of  labor  in  France  is  still  in  a  very  rudimentary 
condition.  Sixty  years  ago,  when  trades  unions  in  England  were  already 
free  from  legislative  control,  it  was  still  an  offense  against  common  law 
for  a  handful  of  French  workmen  to  take  joint  action  with  a  view  to 
obtaining  better  conditions  from  their  employer;  and  it  is  only  since 
1884  that  trades  unions  in  France  have  been  recognized.  In  some 
countries  this  might  have  been  a  sufficiently  long  period  to  permit  of 
a  fair  amount  of  settling  down ;  but  the  testimony  of  practically  all  the 
experts  whom  I  have  consulted  shows  that  the  conditions  in  France  are 
peculiarly  unfavorable  to  the  efficient  working  of  the  machinery.  The 
French  workman's  strong  aversion  to  discipline  and  restraint  tends, 
in  the  first  place,  to  keep  him  outside  of  any  organization,  and  the 
result  is  that  the  disciplined  forces  of  labor  represent  only  a  small 
fraction  of  the  great  body  of  workers.  Side  by  side  with  impatience  of 
control  there  appears  to  be,  in  the  French  workman 's  character,  a  deep- 
rooted  mistrust  of  those  in  authority,  whether  his  own  elected  repre- 
sentatives or  government  officials.  No  real  confidence  is  placed  in  any 
one  man  or  small  body  of  men.  There  are  innumerable  splits  and  dis- 
sensions, but  there  is  little  united  action. 

No  other  country  in  Europe  faces  so  difficult  a  situation  as  does 
France  in  dealing  with  labor  problems.  This  is  due  not  only  to  the 
fact  that  politics  and  labor  questions  in  France  are  hopelessly  mixed, 
but  also  because  of  the  peculiar  temperament  of  the  French  employer 
and  the  French  wage-earner. 

The  leading  French  labor  leaders  frankly  admitted  to  me  that  the 
French  workman  is  mercurial,  excitable,  impetuous,  hasty,  lacking  in 
self-control,  and.  therefore,  very  hard  to  discipline.  A  most  conserva- 
tive and  level-headed  French  labor  leader  said  to  me  that  the  tendency 
of  the  French  wage-earner  is  first  to  delegate  power  to  his  leaders,  and 
then  at  the  supreme  moment  to  snatch  it  out  of  their  hands.  This 
peculiar  temperament  leads  to  many  reckless  and  ill-advised  strikes. 

The  attitude  and  the  temperament  as  a  rule  of  the  French  employer 
also  adds  no  little  to  the  difficulty  of  the  situation.  A  leading  authority 
on  the  question,  says,  "French  employers  and  employees,  as  a  rule, 
don't  know  each  other  and  don't  trust  each  other.  Employers,  as  a 
rule,  are  unwilling  to  discuss  with  workmen,  and  workmen  are  unwilling 
to  respect  arrangments  made  in  their  name. ' ' 

The  result  under  these  circumstances  can  not  be  otherwise  than  very 
strained  relations  between  employers  and  their  workmen. 


40  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

SOCIALISM. 

The  labor  question  in  France  is  hopelessly  entangled  with  socialism,, 
and  socialism  in  that  country  stands  for  political  action. 

At  the  last  general  French  election  the  Socialists  cast  896,000  votes 
and  they  have  to-day  seventy-six  representatives  out  of  five  hundred 
and  eighty-four  members  of  the  lower  house.  This  has  brought  about 
a  tendency  on  the  part  of  the  French  workman  to  devote  his  energies 
to  politics  rather  than  to  economic  unionism,  and  this  in  turn  has  led 
to  much  disappointment  on  the  part  of  many  socialistic  wage-earners 
who  expected  much  in  the  way  of  a  betterment  in  their  material  con- 
ditions as  the  result  of  political  action,  and  who  now  advocate  the  direct 
and  sudden  strike  instead  of  looking  for  relief  to  politics.  This  strong- 
leaning  in  the  direction  of  the  strike  is  encouraged  by  the  anarchistic 
elements  among  the  Socialists  and  the  unionists. 

WAGES. 

The  tendency  of  wages  in  France  since  1906  has  been  upward  in  the 
printing  and  building  trades,  and  either  stationary  or  downward  in  all 
the  other  trades. 

The  average  wage  for  an  unskilled  workman  in  Paris  is  eighty  to 
ninety  cents  a  day  and  for  skilled  labor  from  $1.60  to  $2.00  a  day.  The 
average  wage  for  all  of  France  in  the  printing  trades  is  ninety  cents  a 
day.  The  building  trades  pay  sixteen  to  eighteen  cents  an  hour,  with 
ten  hours  work  a  day  in  summer,  and  about  one  hundred  and  ten  hours 
work  a  month  in  winter.  Pick  and  shovel  men  earn  from  75  cents  to 
$1.10  a  day  in  the  provinces.  In  Paris,  owing  to  the  extraordinary 
demand  caused  by  the  building  of  the  subway,  these  workers  have  been 
receiving  from  $1.25  to  $1.50  a  day.  Paris  wages,  however,  are  not 
a  guide  for  the  wages  in  France. 

The  secretary  of  the  Labor  Federation  made  the  statement  that  in  the 
making  of  clay  pipes,  for  example,  at  Omar,  a  town  about  one  hundred 
and  twenty  miles  from  Paris,  a  team  of  three,  consisting  of  a  man, 
woman  and  boy,  will  earn  collectively  but  $5.60  a  week,  with  a  working 
day  of  twelve  hours.  A  strike  is  now  on  in  this  industry  for  an  increase 
in  wages  for  the  team  of  five  cents  a  day.  He  also  stated  that  women 
are  employed  in  the  provinces  in  making  watch  chains,  for  example, 
for  which  they  receive  twenty-five  cents  a  day,  while  the  same  sort  of 
work  in  Paris  commands  a  wage  of  $1.50  a  day. 

HOURS  OF  LABOR. 

The  legal  working  day  in  France  is  twelve  hours,  though  the  iron 
workers  have  a  ten-hour  day,  and  the  printing  trades  as  the  result  of  a 
national  strike  in  3906  have  a  nine-hour  day. 


FRANCE.  41 

COST    OF    LIVING. 

All  sides  agree  that  the  cost  of  living  in  France  has  increased  mate- 
rially, some  authorities  placing  the  increase  at  from  ten  to  fifteen  per 
cent,  and  some  putting  it  as  high  as  from  twenty-five  to  thirty  per 
cent.  Figures  published  during  my  sojourn  in  Paris  by  the  Assistance 
Publique,  or  Poor-Law  Department,  which  manages  the  public  hospitals 
and  is  consequently  a  very  large  buyer  of  all  kinds  of  food  supplies, 
show  that  the  cost  of  living  for  foodstuffs  has  increased  by  eighteen  per 
cent  during  the  last  four  years. 

LABOR    UNIONS. 

The  situation  in  France  of  labor  unions  is  unlike  that  of  any  other 
country  in  Europe.  The  governmental  attitude  toward  labor  unions 
seems  eccentric  and  illogical.  To  illustrate:  On  the  one  hand  we  find 
the  municipality  of  Paris,  so  far  back  as  1891,  erecting  a  splendid  and 
costly  labor  temple,  which  has  since  been  occupied  by  two  hundred  and 
fifty  labor  unions,  not  only  free  to  them  of  all  expense,  but  with  an 
annual  subsidy  of  $22,000  for  the  conduct  of  a  free  labor  bureau.  This 
would  indicate  that  the  political  authorities  are  in  sympathy  with 
organized  labor,  and  desire  to  aid  and  encourage  it.  On  the  other  hand, 
however,  labor  unions  are  not  permitted  under  the  law  to  own  prop- 
erty. The  only  explanation  offered  for  this  strange  attitude  is  that  the 
authorities  fear  that  the  ownership  of  property  would  give  too  much 
strength  and  power  to  the  unions. 

The  absurdity  of  this  provision  seems  to  have  forced  itself  on  the 
attention  of  legislators,  some  of  whom  are  now  endeavoring  to  have 
this  law  repealed,  but  strange  to  say,  labor  unionists,  as  a  rule,  do  not 
want  the  law  changed.  They  prefer  that  unions  shall  not  own  property 
in  order  to  remain  legally  irresponsible. 

It  is  difficult  to  get  reliable  information  about  the  actual  strength  of 
labor  unions  in  France.  The  government  depends  for  its  information 
upon  the  unions,  who  in  recent  years  have  adopted  the  policy  of  either 
withholding  or  giving  misleading  information  in  order  to  hide  their 
real  strength.  However,  from  statements  made  to  me  by  labor  union 
secretaries,  it  is  safe  to  say  that  there  are  from  800,000  to  900,000 
organized  wage-earners  in  France,  out  of  which  number  there  arer 
perhaps,  500,000  in  the  General  Federation  of  Labor. 

The  increase  in  the  membership  of  the  General  Federation  of  Labor 
for  this  year  of  140,000  has  been  unusually  large,  due  to  the  fact  that 
50,000  coal  miners  enrolled  themselves  as  members.  Even  the  opponents 
of  unionism  in  France  concede  that  it  is  growing,  but  some  of  them 
maintain  that  such  growth  is  not  so  rapid  as  in  other  countries. 

The  labor  unionists  in  France  are  far  more  revolutionary  than  those 
of  Germany  or  Italy,  and  their  more  recent  aggressive  methods  in 


42  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

endeavoring  to  obtain  favorable  labor  legislation  and  to  enforce  their 
demands  upon  employers,  have  at  times  led  to  serious  riots,  all  of  which 
have  tended  to  antagonize  public  sentiment  and  to  create  a  growing 
hostility  toward  organized  labor. 

The  claim  is  made  by  employers  that  French  labor  leaders  strive  to 
foment  trouble  by  frightening  employers  and  by  dominating  labor.  The 
further  claim  is  made  by  employers  that  there  are  those  among  the 
"Reds"  (the  Socialists)  who  are  constantly  preaching  to  wage-earners' 
that  they  should  diminish  their  output— 

a.  Because  they  say  that  a  small  wage  deserves  only  a  small  effort. 

&.  To  make  work  for  more  hands. 

c.  In  order  to  cripple  and  ultimately  destroy  capitalistic  industries, 
and  thus  sooner  pave  the  way  for  socialism. 

As  a  rule,  employers  do  not  recognize  the  labor  unions  and  per- 
sistently refuse  to  deal,  or  to  discuss  matters  with  their  representatives. 

EMPLOYERS'    ASSOCIATIONS. 

During  the  past  three  years  there  has  been  a  very  pronounced  move- 
ment on  the  part  of  employers  to  organize  in  order  collectively  to  meet 
strikes.  Several  mutual  strike  insurance  associations  have  been  organ- 
ized among  employers.  One  of  these  associations  within  two  years  has 
accumulated  a  strike  fund  of  $3,000,000,  and  another  association  carries 
strike  risks  of  over  $7,000,000.  When  an  employer  has  a  strike  he  is 
allowed,  during  the  life  of  the  strike,  a  daily  amount  to  cover  his 
operating  expenses,  minus  the  pay  roll  of  the  strikers. 

It  is  claimed  that  the  organization  of  employers  and  the  existence  of 
the  strike  insurance  fund  have  had  an  important  influence  in  restraining 
what  would  otherwise  have  been  many  reckless  and  unwarranted  strikes. 

CLOSED  SHOP. 

The  "closed"  shop,  that  is,  the  shop  where  union  workmen  exclusively 
are  employed,  is  hardly  known  in  France.  Every  shop,  as  a  rule,  is 
"open,"  and  the  employer  engages  union  or  nonunion  help  at  his 

pleasure. 

PIECEWORK. 

Piecework  has  been  introduced  in  more  recent  years  with  seeming 
success.  The  managing  director  of  one  of  the  largest  iron  works  in 
France  made  the  statement  that  he  had  adopted  the  piecework  system 
with  the  result  of  an  increased  labor  efficiency  of  fully  thirty-three 
per  cent. 

COLLECTIVE    BARGAINING. 

Individual  bargaining  between  employer  and  employee  seems  to  be 
the  rule  in  France.  Collective  bargaining  has  as  yet  made  little 
progress,  and  by  many  employers  is  regarded  as  impracticable  in 
France,  due  for  one  reason  to  the  fact  that  under  the  law  labor  unions 


FRANCE.  43 

are  forbidden  to  own  property,  thus  destroying  their  financial  responsi- 
bility. The  printing  trades  are  an  exception  to  this  rule.  In  1906  they 
entered  into  a  five  years'  collective  contract  with  their  employers,  which 
thus  far  has  been  faithfully  observed. 

STRIKES. 

Strikes  in  France  have  steadily  increased.  Mons.  Calliard  in  his 
report  to  the  Labor  Committee  of  the  Chamber  of  Deputies,  December 
27,  1907,  calls  attention  to  the  following  comparative  facts : 

No.  of  No.  of  No.  of 

Strikes.     Establishments.      Strikers. 

1897 356  2,568  68,875 

1907 1,275  8,364  197,894 

Before  1899  the  average  yearly  strikes  in  France  were  438,  involving 
79.000  strikers.  From  1899  to  1906  the  average  yearly  strikes  numbered 
801,  involving  192,000  strikers. 

He  (Mons.  Calliard)  makes  the  statement  that  one  explanation  for 
this  increase  in  the  number  of  strikes  is  the  fact  that  the  anarchistic 
elements  among  the  wage-earners  have  largely  joined  the  labor  unions 
since  1899.  This  element  regards  the  strike  as  the  chief  means  of 
education  toward  political  revolution.  While  not  disdaining  partial 
strikes  they  prefer  general  strikes  as  conducive  to  more  speedily  bringing 
on  a  general  revolution. 

The  Anarchists.  Calliard  goes  on  to  point  out,  use  economic  questions 
as  pretexts  for  strikes,  their  main  purpose  being  political  revolution. 
He  calls  attention  to  the  fact  that  through  the  agitation  of  the 
anarchistic  element  among  the  labor  unionists,  a  general  strike  through- 
out France  was  declared  for  an  eight-hour  day  on  May  1,  1906 ;  295 
strikes  took  place  on  that  day  involving  202,507  workers  and  causing 
a  loss  of  3.507.033  days  of  labor,  with  disastrous  results  to  labor  and 
to  many  of  their  unions. 

Another  cause  for  strikes  is  the  attitude  of  the  French  employer  who, 
as  a  rule,  follows  the  policy  of  treating  labor  aggressively  instead  of  in  a 
conciliatory  manner.  Yet  another  cause  for  the  excessive  number  of 
strikes  is  the  lack  of  any  restraining  influence  on  local  labor  unions. 

In  the  United  States,  as  a  rule,  a  local  union  can  not  declare  a  strike 
without  the  approval  of  the  central  body.  This  has  been  found  to  be  a 
powerful  restraining  influence  on  the  hotheads  of  local  organizations. 
In  France,  as  a  rule,  a  majority  of  those  present  at  a  meeting  can 
declare  a  strike  without  reference  to  the  central  body,  which,  however, 
is  obliged  to  support  the  strike,  even  though  the  strike  in  its  judgment 
may  have  been  ill  advised  and  unwarranted. 

In  the  electrical  labor  union  the  conditions  are  even  more  radical,  the 
power  to  declare  a  strike  being  placed  in  the  hands  of  a  secret  committee 
of  three,  who  are  supreme  in  the  matter,  and  whose  orders  must  be  obeyed. 


44  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

These  methods  lead  to  numerous  strikes  being  declared  as  a  result  of 
passion  rather  than  reflection,  and  in  a  measure  explain  why  so  many 
strikes  in  France  fail,  as  is  shown,  for  example,  by  the  following  report 
for  the  month  of  April,  1908,  the  latest  available  record : 

Strikes  won  12 

Strikes  compromised  36 

Strikes   lost  .  51 


Total  number  of  strikes 99 

It  is  interesting  to  note  the  remedy  for  this  condition  offered  by  some 
of  the  different  parties  in  interest.  The  remedy  suggested  by  one  promi- 
nent labor  leader  was  that  employers  should  modify  their  harsh  attitude 
toward  employees.  The  remedy  suggested  by  one  employer  was  that  all 
employers  should  refuse  to  deal  with  any  but  their  own  employees. 

Yet  another  employer  stated  that  what  he  had  found  to  be  an  efficient 
remedy  was  to  divide  his  workers  into  logical  groups  and  to  ask  each 
group  to  appoint  delegates  with  whom  he  was  ready  and  willing  to  deal, 
and  who  were  to  be  the  only  parties  he  would  recognize. 

ARBITRATION. 

Arbitration,  voluntary  or  compulsory,  has  comparatively  few  advo- 
cates among  French  employers  or  employees.  The  French  employer 
does  not  take  kindly,  as  a  rule,  to  the  idea  of  arbitration  because  this- 
involves  the  acknowledgment  on  his  part  that  labor  has  a  right  to  a  voice 
in  determining  w^ages  and  hours  of  labor.  It  seems  most  difficult  for 
the  French  employer,  as  a  rule,  to  bring  himself  into  a  frame  of  mind 
that  will  concede  this  right. 

Wage-earners  seem  to  be  averse  to  arbitration  on  the  theory  that  the 
arbitrator  with  whom  would  rest  the  final  decision  in  labor  disputes, 
would  be  apt  to  belong  to  the  class  in  sympathy  with  employers,  and 
hence  the  wage-earner  would  not  be  likely  to  get  a  square  deal. 

The  unfavorable  attitude  of  both  sides  to  arbitration  is  emphasized 
by  the  fact  that  in  1892  a  law  was  enacted  which  provides  that  in  labor 
disputes  the  local  magistrate  may  intervene  as  a  conciliator  and  arbi- 
trator. The  law,  however,  has  remained  practically  a  dead  letter  as 
neither  side  has,  as  a  rule,  availed  itself  of  this  medium  for  the  peace- 
ful settlement  of  their  differences. 

The  marked  difference  between  the  attitude  of  American  labor  union- 
ists and  French  labor  unionists  in  labor  disputes  lies  in  the  American 
policy  of  resorting  to  the  strike  only  after  every  effort  for  conciliation 
and  arbitration  has  failed,  and  the  French  policy  of  using  the  strike  as. 
an  immediate  resort  if  the  employer  refuses  promptly  to  grant  the  con- 
cessions demanded. 

Employers  and  labor  unionists  in  France  are  a  unit  in  their  opposition 
to  compulsory  arbitration  in  the  settlement  of  labor  disputes.  Labor 


FRANCE.  45 

is  opposed  to  it  because  it  claims  it  would  rob  it  of  the  right  to  strike, 
which  it  regards  as  its  chief  weapon  of  defense.  Employers  are  opposed 
to  it  because  they  resent  any  interference  in  labor  disputes  on  the  part 
of  the  State,  and  because,  as  was  pointed  out  by  the  editor  of  the  Labor 
Record,  published  by  the  Ministry  of  Labor,  a  judge  in  deciding  civil 
cases  is  aided  .by  the  law,  whereas,  in  cases  of  arbitration,  he  has  no 
such  guide,  and  hence  it  is  almost  impossible  for  the  arbitrator  to 
render  equitable  decisions. 

Despite  the  pronounced  opposition  to  State  intervention  in  labor 
disputes  on  the  part  of  employers  and  wage-earners,  strikes  are  growing 
so  numerous  and  so  threatening  in  their  revolutionary  character  in 
France  that  the  political  party  in  power  contemplates  introducing  a 
Mil  at  the  next  session  of  Deputies  having  a  mild  species  of  compulsory 
arbitration  in  view.  This  measure  is  known  as  M.  Millerand's  bill  for 
the  amicable  settlement  of  disputes  regarding  labor  conditions. 

The  bill  provides  that  where  the  employer  does  not  accede  to  the 
demands  of  the  workers,  the  latter  shall  state  their  claims  in  writing. 
The  employer  shall  "within  forty-eight  hours  send  a  written  reply  giving 
the  names  of  the  arbitrators  he  selects.  Failing  in  this,  the  wage- 
earners  may  legally  declare  a  strike. 

If,  on  the  other  hand,  the  employer  names  arbitrators,  the  workmen 
in  turn  shall  within  forty-eight  hours  make  known  the  names  of  the 
arbitrators  chosen  by  them.  If  the  decision  of  the  arbitrators  be  not 
made  known  within  six  days,  the  workmen  may  legally  strike.  No 
strike  to  be  declared  unless  a  secret  ballot  has  been  taken.  A  strike 
being  declared,  the  labor  council  (which  is  a  body  consisting  of  repre- 
sentatives of  employers  and  employees,  previously  elected  by  their 
respective  sides)  shall  be  called  in  to  settle  the  dispute,  and  their 
finding  shall  rank  as  an  arbitrator's  award. 

A  failure  to  abide  by  the  decision  shall  be  penalized  by  the  loss  for 
a,  period  of  three  years  of  the  "right  to  vote  for,  or  to  be  elected  as  the 
representative  of  any  labor  body,  or  chamber  of  commerce,  or  com- 
mercial courts,  or  the  superior  labor  council.  In  case  of  a  second  offense 
the  loss  shall  be  for  six  years. 

The  party  in  power,  which  is  fathering  this  measure,  having  a 
majority  in  the  house,  it  is  believed  that  the  bill  will  carry. 

The  fact,  however,  that  while  a  penalty  is  provided  for  a  failure  to 
abide  by  the  decision  of  the  arbitrators,  this  penalty  is  so  mild  in 
character  as  likely  to  have  little  or  no  restraining  influence,  and  the 
further  fact  that  no  penalty  is  provided  for  a  failure  on  the  part  of 
employers  or  employees  to  observe  the  initial  steps  in  the  proposed 
settlement  of  the  dispute,  would  make  it  plain  that  the  measure,  should 
it  become  law,  is  likely  to  prove  inefficient  and  ineffective. 


46  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 


ENGLAND. 


One  can  not  investigate  the  labor  laws  and  labor  conditions  in  England 
without  soon  discovering  that  British  workmen  and  employers  have 
long  since  passed  through  the  stages  now  being  experienced  by  both 
in  other  European  countries.  The  fact  is  speedily  forced  on  one's 
attention  that  most  continental  countries,  in  the  matter  of  dealing  with 
labor  problems,  are  to-day  where  England  was,  say.  forty  years  ago. 
The  English  wage-earner,  as  a  rule,  is  far  more  amenable  to  reason 
than  is  his  fellow-worker  on  the  continent.  "While  the  English  worker 
can  not  be  driven,  and,  so  long  as  he  believes  himself  in  the  right, 
fights  with  a  bulldog  tenacity,  yet  when  his  reason  is  appealed  to  and 
the  right  way  pointed  out,  he  is,  as  a  rule,  easily  led  by  those  in  whom, 
he  has  confidence. 

LIVING    CONDITIONS    OF    BRITISH    WORKMEN. 

The  conditions  under  which  the  British  workman,  as  a  rule,  lives 
are  better  than  are  the  conditions  generally  under  which  the  continental 
worker  lives.  The  English  policy  of  free  trade  means  cheap  and  abund- 
ant food  for  its  people,  due  to  the  fact  that  the  food  producers  of  every 
clime  are  in  constant  competition  with  each  other  for  the  English  trade. 
Most  continental  countries,  on  the  other  hand,  having  large  agricultural 
interests,  have  deemed  it  essential  to  establish  for  their  protection  high 
tariffs  against  foreign  foodstuffs,  thus  enhancing  the  cost  of  living  of 
their  wage-earners. 

While  there  are  yet  tens  of  thousands  of  British  workmen,  especially 
among  the  nonskilled,  who  live  in  congested  and  unsanitary  districts 
in  the  large  British  cities,  such  as  London,  GlasgOAV,  Liverpool,  and 
Manchester,  there  are  many  other  tens  of  thousands  who  are  more  com- 
fortably housed  than  are  the  continental  wage-earners.  Even  in  thickly 
populated  London  miles  upon  miles  of  streets  are  lined  with  wage- 
earners'  cottages  where,  at  a  reasonable  rental,  each  one  may  live,  with 
his  family,  under  comfortable  and  sanitary  conditions.  Single  cottages 
for  wage-earners  are  almost  unknown  in  the  large  continental  cities 
where  great  numbers  of  workingmen  are  housed  in  tenements  with  but 
two,  and  rarely  three,  rooms  to  a  family,  however  large  the  family 
may  be. 

LABOR    UNIONS    IN    POLITICS. 

Some  fifteen  years  ago  the  tendency  began  on  the  part  of  British 
labor  to  enter  politics  as  an  independent  political  body.  To-day  the 


ENGLAND.  47 

wage-earners  have  fifty-seven  representatives  out  of  a  membership  in 
Parliament  of  six  hundred  and  seventy.  While  these  labor  represen- 
tatives differ  radically  on  many  political  issues,  yet  when  it  comes  to 
labor  legislation,  as  a  rule,  they  vote  as  a  unit.  Thus,  often  by  holding 
the  balance  of  power,  they  have  been  able  to  obtain  much  legislation  in 
recent  years  favorable  to  labor.  The  most  notable  achievement  along 
these  lines  was  the  passage  by  Parliament  of  the  "Trades  Disputes  Act' 
of  1906,  section  four  of  which  reads  as  follows:  "An  action  against  a 
trade  union,  whether  of  workmen  or  masters,  or  against  any  members 
or  officials  thereof  on  behalf  of  themselves  and  all  other  members  of 
the  trade  union  in  respect  to  any  tortious  act  alleged  to  have  been 
committed  by  or  on  behalf  of  the  trade  union,  shall  not  be  entertained 
by  any  court."  Mr.  D.  J.  Shaneleton,  labor  member  of  Parliament, 
who  was  chiefly  instrumental  in  passing  this  measure  through  Parlia- 
ment, which  absolutely  exempts  the  funds  of  labor  unions  against  court 
judgments,  informed  me  that  Parliament  was  persuaded  to  pass  this 
law,  radical  as  it  is,  because  he  had  been  able  to  prove  to  its  satisfaction 
that  employers  were  violating  the  statute  against  blacklisting.  This 
measure  was  therefore  enacted  in  order  to  give  workmen  a  counter 
protection. 

CHARACTER     OF    BRITISH     LABOR    LEADERS. 

It  is  interesting  to  learn  of  the  exceeding  care  exercised  by  the  British 
labor  unionist  in  the  selection  of  his  trade  union  officials  and  political 
representatives.  Such  a  scene  would  have  been  impossible  in  England 
as  was  witnessed  some  years  ago  in  the  city  of  New  York,  when  the 
notorious  Sam  Parks,  the  corrupt  labor  leader,  convicted  of  taking 
bribes  in  consideration  of  his  declaring  strikes  in  order  to  injure  rival 
contractors,  immediately  upon  his  release  from  prison  was  welcomed 
by  many  trade  unionists  as  a  hero  and  a  martyr,  chosen  as  marshal  of 
the  Labor  Day  parade  and  greeted  en  route  by  deafening  cheers  from 
labor  admirers  and  labor  sympathizers.  Nor  would  it  have  been  possible 
in  England  to  elect  for  a  second  and  a  third  term,  to  high  public  office, 
largely  by  labor  votes,  such  a  notorious  scoundrel  and  bribetaker  as 
Eugene  Schmitz,  the  ex-mayor  of  San  Francisco,  or  his  coterie  of 
bribetaking  labor  union  board  of  supervisors,  who,  by  their  infamous 
and  corrupt  conduct,  dragged  the  good  name  of  organized  labor  through 
the  gutters,  and  in  the  minds  of  many  of  their  fellow  citizens  and  in 
the  minds  of  many  in  foreign  lands,  tended  to  establish  an  unfavorable 
opinion  of  American  labor  unions  in  general. 

While  at  a  gathering  at  which  happened  to  be  present  a  number  of 
directors  and  also  the  general  manager  of  one  of  England's  largest 
railway  lines,  I  had  occasion  to  mention  that  I  had  just  come  from  an 
interview  with  the  secretary  of  the  Amalgamated  Railway  Employees' 


48  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

Union.  All  present  commented  upon  the  secretary's  high  character, 
fair-mindedness  and  spotless  integrity.  They  said  these  things  despite 
the  fact,  as  they  themselves  explained,  that  at  times  they  differed  most 
radically  with  him  on  the  questions  of  wages,  hours  of  labor,  etc. 

Without  exception  the  opinion  of  all  the  employers  and  officials  whom 
I  met  while  in  England  was  to  the  effect  that  British  labor  leaders  are 
tried  men  who,  because  they  are  honest  and  dependable,  have  the  confi- 
dence of  employers  and  workmen.  Even  opposing  employers  freely 
admitted  that  British  labor  leaders  have  developed  into  able  diplomats 
and  business  men  of  high  order.  In  this  connection  ex-Prime  Minister, 
A.  J.  Balfour,  is  quoted  as  saying:  "Trade  disputes  in  England  have 
been  carried  on  with  a  wisdom  and  moderation  on  both  sides  which  can 
not  be  paralleled  by  any  other  industrial  community.  Surely  it  must  be 
admitted  that  these  admirable  results  are  in  no  small  degree  due  to  the 
statesmanship,  the  moderation  and  the  wisdom  which  have,  on  the  whole, 
guided  the  leaders  of  the  trades  unions  in  dealing  with  the  difficult 
problems  which  must  from  time  to  time  arise  in  industrial  society. ' ' 

Graft  and  grafters  find  no  lodgment  in  British  labor  unions.  This, 
together  with  the  care  and  the  good  judgment  exercised  in  the  selection 
of  honest  and  capable  leaders,  has  won  the  esteem  and  the  respect  of  the 
British  public  for  the  labor  movement  and  has  added  much  to  its  influ- 
ence and  usefulness. 

WAGES   IN    GREAT   BRITAIN. 

The  latest  British  government  report  shows  that  in  1906  and  in  1907 
wages  increased  in  every  group  of  trades,  but  that  this  upward  tendency 
was  arrested  early  in  1908. 

According  to  the  fifteenth  report  of  the  British  Labor  Department 
for  1907  the  prevailing  wages  in  England  in  various  industries  were 

as  follows: 

Compositors  : $9.00  per  week. 

Bookbinders  $7.75  per  week. 

Bakers  $9.25  per  week. 

Dock  laborers 16  cents  per  hour. 

Street  car  conductors 10  cents  per  hour. 

Street  car  motormen $1.18  per  day. 

Laborers  $5.00  per  week. 

Painterg $6.75  per  week. 

Letter  carriers.-. $4.50  to  $7.50  per  week,  according  to  length  of  service. 

Policemen  „ $8.50  per  week. 

Farm  laborers $4.00  to  $5.00  per  week. 

Iron  founders $10.00  per  week. 

Carpenters  IS  cents  per  hour. 

Bricklayers 20  cents  per  hour. 

Plumbers 20  cents  per  hour. 

Plasterers -16  cents  per  hour. 

(Fifty   hours   constitutes   a   week's   work.) 

According  to  the  same  report  the  sliding  scale  of  wages  which  for 
years  prevailed  in  some  industries,  notably  in  coal  mining,  is  going  out 


ENGLAND.  49 

of  favor  on  the  theory  that  wages  should  not  be  dependent  on  selling 
prices. 

The  depression  of  1908  led  to  the  cutting  of  wages  in  the  iron,  ship 
building  and  textile  industries,  and  some  railway  lines  have  posted 
notices  that  a  cut  in  wages  is  to  go  into  effect  on  January  1,  1909. 

t 

COST  OF  LIVING  IN  ENGLAND. 

The  cost  of  living  in  England  has  increased  in  recent  years,  though 
not  in  so  marked  a  degree  as  in  other  European  countries.  There  has 
been  an  increase  in  wage-earners'  rentals,  estimated  at  from  ten  to 
twenty  per  cent,  during  the  past  two  or  three  years,  and,  according  to 
the  latest  government  reports,  issued  by  the  board  of  trade,  there  has 
been  the  following  percentage  of  changes  in  retail  prices  during  the 
past  ten  years,  of  twenty-three  principal  articles  of  food  in  London : 

1897 96.2  per  cent. 

1900 - 100.0  per  cent. 

1907 105.7  per  cent. 

The  average  increased  cost  in  ten  years  was  9.87  per  cent.  The 
twenty-three  articles  are  bread,  flour,  beef,  mutton,  pork,  bacon,  butter, 
eggs,  milk,  cheese,  potatoes,  currants,  raisins,  rice,  tapioca,  oatmeal,  tea, 
coffee,  cocoa,  sugar,  jam,  treacle  and  molasses. 

TRADE  UNIONISM  IN  GREAT  BRITAIN. 

According  to  the  statement  of  the  secretary  of  the  British  Labor  Fed- 
eration there  are  15,000,000  industrial  workers  in  Great  Britain,  of 
whom  2,500,000  are  unionized.  It  is  claimed  by  trade  union  representa- 
tives that  unionism  is  steadily  growing  in  Great  Britain. 

Unlike  on  the  continent  there  is  no  hostility  in  Great  Britain  toward 
labor  unions  and  British  employers,  as  a  rule,  recognize  and  deal  with 
labor  union  representatives.  The  exceptions  to  this  rule  are  occasional 
individual  employers. 

The  consensus  of  opinion  among  British  labor  authorities  is  that  the 
relations  between  British  employers  and  their  workmen  are  growing 
more  cordial,  due  partly  to  the  methods  of  conciliation  which  are  steadily 
growing,  and  due,  as  maintained  by  others,  to  labor  going  into  politics 
and  thus  being  brought  into  closer  contact  with  employers. 

BRITISH  EMPLOYERS'  ASSOCIATION.  ' 

Employers'  associations  are  said  to  be  growing  in  Great  Britain  in 
greater  ratio  than  workmen's  associations.  One  of  the  prime  purposes 
of  such  associations  is  to  meet  and  deal  with  strikes.  Strike  insurance 
fraternities  among  British  employers  are  now  nearly  fifteen  years  old. 

Labor  seems  to  look  with  satisfaction  upon  these  employers'  associa- 

4 


50  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

tions,  since  it  takes  away  the  employer's  claim  that  he  wants  to  deal 
with  his  men  individually.  It  also  obviates,  it  is  claimed,  unpleasant 
personalities.  As  a  rule,  the  employers'  associations  secure  the  services 
of  an  attorney  to  act  as  secretary. 

CLOSED  SHOP. 
i 

The  "closed  shop,"  that  is,  the  shop  where  only  union  workers  are 
employed,  prevails  wholly  among  the  engineers,  the  printing  trades  and 
the  textile  industry. 

COLLECTIVE  BARGAINING. 

Again,  unlike  the  conditions  prevailing  on  the  continent  of  Europe, 
collective  bargaining  is  the  common  practice  in  Great  Britain  and 
generally  prevails.  Much  value  has  been  added  to  the  practice  of 
collective  bargaining,  and  the  making  of  contracts  between  employers 
and  their  workmen  for  extended  periods,  because  of  the  fact  that  the 
British  workman,  as  a  rule,  is  not  a  contract  breaker,  and  the  employer 
knows  that  a  contract  once  entered  into  with  labor  unionists,  even  if  it 
should  later  prove  to  them  disadvantageous,  will,  in  all  likelihood,  be 
respected  and  kept. 

THE  UNEMPLOYED. 

The  depression  of  1908  has  led  to  a  great  army  of  unemployed.  The 
problem  has  demanded  the  greatest  judgment  and  statesmanship  on  the 
part  of  the  administration.  Extensive  public  improvements  have  been 
entered  upon  with  the  view  of  lessening  so  far  as  possible  the  consequent 
distress. 

The  General  Federation  Trade  Union,  in  its  report  for  1906-1907, 
strongly  urges,  as  a  preventive  for  unemployment,  the  policy  of  regu- 
lating and  shortening  hours  during  slack  times  in  order  to  minimize 

this  evil. 

STRIKES. 

The  most  serious  strikes  in  Great  Britain  in  recent  years,  barring 
the  cotton  trouble  in  October,  1908,  have  been  in  the  ship  building 
trade. 

Great  Britain  is  the  only  country  in  Europe  that  I  have  investigated 
where  strikes  are  on  the  decrease.  As  an  illustration  of  the  marked 
influence  conciliation  and  arbitration  in  Great  Britain  are  having  in 
avoiding  industrial  strife,  the  following  figures  are  quoted  from  the 
Government  Report  of  1907  on  Strikes  and  Lockouts : 

Number  of        Work  people         Duration  of 
disputes.  involved.      working  days  lost. 

1897 864  230,267  10,345,523 

1907 601  147,498  2,162,151 

It  will  be  noted  that  in  the  last  ten  years  the  number  of  disputes  has 
diminished  by  34.40  per  cent,  the  number  of  workmen  involved  has 
been  decreased  by  36.03  per  cent,  and  the  number  of  working  days 


ENGLAND.  51 

lost,  which  after  all  is  the  correct  unit  to  be  considered,  has  been 
reduced  by  79.10  per  cent.  This  is  the  most  remarkable  record  of  any 
country  I  have  thus  far  investigated. 

When  the  increase  by  leaps  and  bounds  is  considered  of  strikes  and 
lockouts  in  most  other  important  industrial  countries  of  Europe,  with 
their  consequent  enormous  cost  and  accompanying  misery  and  suffering 
imposed  on  armies  of  workers  and  their  dependents,  this  British 
strike  record  is  a  most  powerful  argument  in  favor  of  the  progressive 
methods  pursued  in  Great  Britain  in  recent  years  along  the  lines  of 
conciliation  and  arbitration. 

British  labor  authorities,  gratified  as  they  must  be  with  the  admirable 
showing  made  in  the  diminished  number  of  strikes  and  lockouts  in  the 
last  ten  years,  are,  however,  looking  forward  to  the  time  when  Great 
Britain  may  be  able  to  point  to  a  clean  slate,  and  when  not  a  single 
day's  labor  will  have  been  lost  because  of  a  labor  dispute. 

STRIKE    REMEDIES. 

Various  remedies  were  suggested  for  the  further  diminishing  of 
British  strikes  and  lockouts.  Socialists,  such  as  Kier  Hardie,  expressed 
to  me  the  opinion  that  the  final  remedy  is  socialism,  and  that,  pending 
the  general  acceptance  of  this  remedy,  relief  lies  in  stronger  organi- 
zation on  the  part  of  labor.  Other  Socialists,  such  as  Sydney  Webb, 
believe  that  a  most  potent  factor  for  the  further  diminishing  of  strikes 
juid  lockouts  is  for  the  State  to  intervene  to  the  extent  of  fixing  a  mini- 
mum wage  for  every  industry,  less  than  which  wage  it  should  be  a 
penal  offense  for  the  workmen  to  accept  or  for  the  employer  to  pay. 
The  Right  Honorable  John  Burns,  labor  leader  and  Cabinet  Minister, 
said  to  me  that  in  his  opinion  the  remedy  lies  in  voluntary  arbitration. 
Secretary  Appleton  of  the  British  Federation  of  Labor  expressed  the 
opinion  that  the  best  remedy  is  the  frank  recognition  more  generally  of 
employers  and  workmen  to  the  right  of  collective  bargaining.  The 
Right  Honorable  Winston  Churchill,  Cabinet  Minister  and  President 
of  the  Board  of  Trade,  which  corresponds  to  our  Department  of  Com- 
merce and  Labor  at  Washington,  D.  C.,  made  the  statement  that,  in  his 
opinion,  the  struggle  between  capital  and  labor  is  eternal,  and  that 
perpetual  industrial  peace  can  never  be  established.  Dr.  Shadwell, 
the  labor  editor  of  the  London  Times,  said  that,  in  his  opinion,  the 
remedy  lies  in  strong  counter  organization,  so  that  one  side  may  better 
hold  the  other  in  check  and  by  its  powerful  organization  have  a  strong 
restraining  influence  on  the  other.  Another  distinguished  English 
journalist,  the  editor  of  the  London  Chronicle,  gave  it  as  his  opinion 
that  the  tendency  of  labor  to  achieve  its  ends  seemed  to  be  in  the 
direction  of  electing  representatives  to  Parliament  rather  than  through 
strikes.  Sir  Charles  Furness,  one  of  England's  great  shipbuilders, 


52  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

believes  the  remedy  lies  in  copartnership,  and  has  shown  his  faith  in 
such  remedy  by  offering  to  sell  to  his  workmen  shares  of  stock  in  his 
enterprise  and  accept  deferred  payments  at  the  rate  of  five  per  cent 
of  the  weekly  wage,  with  the  understanding,  however,  that  there  must 
be  no  strikes  or  lockouts.  This  offer  has  been  accepted  by  his  employees. 
Richard  Bell,  member  of  Parliament  and  a  labor  leader,  expressed  to  me 
the  opinion  that  further  relief  must  come  along  the  line  of  compulsory 
inquiry. 

THE  VALUE  OF  BRITISH  PUBLIC  OPINION  IN  RELATION  TO 
STRIKES  AND  LOCKOUTS. 

The  Eight  Honorable  John  Burns  placed  little  value  on  the  influence 
of  public  opinion  in  its  effect  on  strikes  and  lockouts.  He  maintained 
that  the  great  growth  during  the  past  fifteen  years  of  employers' 
associations  and  labor  unions  has  tended  to  make  both  more  and  more 
indifferent  to  public  sentiment,  which  he,  for  one,  regarded  as  a  neg- 
ligible factor  in  labor  disputes.  This  opinion  was  shared  by  Dr.  Shad- 
well,  the  labor  editor  of  the  London  Times,  and  one  who  is  regarded 
as  an  eminent  authority  on  labor  questions. 

As  against  these  opinions  are  those,  however,  of  such  men  as  Richard 
Bell,  member  of  Parliament  and  secretary  of  the  Amalgamated  Railway 
Employees'  Union,  the  Right  Honorable  Thomas  Burt,  for  forty-three 
years  secretary  of  the  Northumberland  Coal  Miners'  Association,  Sir 
Albert  Slicer,  president  of  the  London  Chamber  of  Commerce,  George 
Howell,  Esq.,  ex-member  of  Parliament  and  an  acknowledged  British 
authority  on  labor  questions,  whose  contention  is  that  public  opinion, 
as  a  rule,  is  the  ultimate  deciding  factor  in  strikes  and  lockouts,  C.  G. 
Hyde,  Esq.,  member  of  Parliament  and  a  great  British  contractor, 
Robert  Donald,  editor  of  the  London  Chronicle,  and  others,  all  of  whom 
expressed  themselves  as  regarding  public  opinion  in  the  matter  of 
strikes  and  lockouts,  more  especially  when  taken  in  connection  with  a 
public  utility,  as  a  factor  of  great  force. 

CONCILIATION  AND  VOLUNTARY  ARBITRATION. 

Great  Britain,  because  of  its  splendid  record  and  its  achievements 
along  the  line  of  conciliation  and  arbitration  in  labor  disputes,  may  be 
rightly  regarded,  among  the  countries  I  have  thus  far  investigated,  as  the 
nursery  for  peaceful  methods  of  adjusting  labor  difficulties.  The  first 
great  step  along  these  lines  was  taken  by  the  London  Chamber  of  Com- 
merce which,  shortly  after  the  great  strike  of  dock  laborers  some  seven- 
teen or  more  years  ago,  on  the  initiative  of  Sir  Samuel  Boulton,  began 
a  movement  for  the  peaceful  settlement  of  labor  disputes,  which  has 
upset  all  preconceived  notions  of  conciliation  and  arbitration  methods, 
and  which  has  proven  an  unqualified  success. 


ENGLAND.  53 

It  was  the  opinion  in  Great  Britain  then,  as  it  is  the  opinion  in  most 
places  to-day,  that  in  the  adjustment  of  labor  disputes  by  arbitration 
there  must,  as  a  rule,  be  three  parties  (a)  representatives  for  each  dis- 
putant; and  (6)  a  third  party  to  act  as  chairman  and  referee  and  to 
give  the  casting  vote.  The  chamber  of  commerce  adopted  an  entirely 
new  principle  and  eliminated  the  third  factor,  namely,  the  referee  or 
deciding  member.  By  consultation  with  the  trade  unions  two  panels 
were  elected  of  twelve  members  each,  one  panel  from  among  the  mem- 
bers of  the  chamber  of  commerce  and  the  other  panel  of  twelve  members 
from  among  the  trades  unions.  Every  dispute  brought  before  the  cham- 
ber of  commerce  was  referred  to  a  committee  of  one  or  two,  or  a  greater 
equal  number,  of  jurors  chosen  from  each  of  these  two  panels.  No  mem- 
ber chosen,  however,  had  any  direct  interest  in  the  dispute  in  hand. 

For  seventeen  years  these  committees,  separately  chosen  for  each  case, 
have  acted  on  all  disputes  brought  before  them  with  the  remarkable 
record  that  their  decisions,  without  exception,  have  been  unanimous,  and 
with  the  still  more  remarkable  record  that,  without  exception,  their 
decisions  have  been  accepted  and  carried  out  in  good  faith  in  every  case 
by  both  parties  to  the  dispute.  The  labors  of  the  chamber  have  been 
confined  to  disputes  arising  in  Greater  London. 

In  addition  to  the  foregoing  movement,  Parliament,  in  1896,  passed 
a  conciliation  act  empowering  the  board  of  trade,  which,  as  previously 
explained,  corresponds  to  the  Department  of  Commerce  and  Labor  at 
Washington,  D.  C.,  to  appoint  a  conciliator  in  trade  disputes  and  an 
arbitrator  at  the  request  of  both  parties. 

When  contestants  will  not  listen  to  arbitration,  the  board  of  trade 
usually  sends  a  high  grade  man  as  conciliator,  who  talks  separately 
with  each  party  in  the  hope  of  reaching  a  common  ground.  Sometimes 
this  plan  succeeds.  Where  it  fails  the  department  will  send  a  repre- 
sentative on  the  ground,  who  makes  the  best  possible  report  based  on 
whatever  information  he  finds  available,  and  this  report  is  published  for 
the  benefit  of  the  public. 

As  an  illustration  of  the  way  the  board  of  trade  sometimes  finds  it 
essential  to  operate  may  be  cited,  as  a  ease  in  point,  the  action  it  took  in 
1907  in  averting  what  threatened  to  be  the  greatest  railway  strike  in  the 
history  of  the  United  Kingdom. 

A  demand  was  made  by  the  representative  of  the  Amalgamated  Rail- 
way Employees'  Association  for  a  number  of  concessions,  including  an 
increase  of  wages,  a  shortening  of  hours  and  recognition  of  the  amal- 
gamated association.  The  railway  companies  firmly  refused  to  con- 
sider the  demands.  A  referendum  vote  was  finally  taken  by  the  amal- 
gamated association  on  the  question  of  going  out  on  strike,  which  carried 
by  an  overwhelming  majority.  The  public  became  greatly  alarmed  for 


54  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

fear  of  the  traffic  of  the  United  Kingdom  becoming  seriously  crippled, 
if  not  paralyzed,  for  an  indefinite  period.  The  outlook  grew  so  serious 
that  the  Eight  Honorable  Lloyd  George,  then  the  president  of  the  board 
of  trade,  personally  assumed  the  role  of  conciliator  and  interviewed 
separately  the  representatives  of  each  side.  At  first  he  found  the  situa- 
tion apparently  irreconcilable,  the  chief  point  of  difference  being  the 
question  of  recognizing  the  amalgamated  association,  which  the  railway 
companies  absolutely  refused  to  consider,  though  quite  ready  and  willing 
to  deal  with  the  separate  railway  unions.  The  strike  seemed  apparently 
inevitable  and  Mr.  George  found  himself  obliged  to  abandon  his  hope 
of  at  least  bringing  the  two  contending  parties  face  to  face.  As  related 
to  me  by  one  of  the  railway  managers,  Mr.  George  then  invited  the  rail- 
way managers  to  meet  him  collectively  in  one  of  the  board  of  trade 
rooms,  and  at  the  same  time  invited  the  labor  representatives  to  meet 
him  in  another  one  of  the  board  of  trade  rooms.  After  spending  hours 
in  going  from  one  room  to  the  other,  and  getting  first  one  concession 
from  one  side  and  then  another  concession  from  the  other  side,  he  grad- 
ually arrived  at  a  common  ground  upon  which  a  compromise  settlement 
was  effected.  The  railway  companies  remaining  immovable  in  their 
determination  not  to  recognize  the  amalgamated  association,  it  was 
finally  arranged  that  a  separate  agreement  should  be  made  between  the 
railway  companies  and  the  board  of  trade,  and  also  between  the  amalga- 
mated association  and  the  board  of  trade,  both  parties  binding  themselves 
to  the  board  of  trade  to  choose  conciliators  from  among  themselves  to 
whom  were  to  be  submitted  all  grievances  for  adjustment  relating  to 
hours,  wages,  etc.  In  the  event  of  the  conciliators  failing  to  reach  an 
understanding  the  matters  were  to  be  settled  by  arbitration,  the  board 
of  trade  to  appoint  the  arbitrators,  whose  award  was  to  be  binding  on 
both  parties.  These  agreements  were  to  hold  good  for  a  period  of  seven 
years.  In  this  wise  was  averted  what  might  have  proven  one  of  the  most 
disastrous  strikes  in  the  railway  history  of  the  United  Kingdom. 

These  slender  means  of  intervention,  says  the  Right  Honorable 
Winston  Churchill,  president  of  the  board  of  trade,  have  been  employed 
in  cases  where  opportunity  has  offered,  and  the  work  of  the  department 
in  this  sphere  has  considerably  increased  in  recent  years.  In  1905  the 
board  of  trade  intervened  in  fourteen  disputes  and  settled  them  all ;  in 
1906  they  intervened  in  twenty  cases  and  settled  sixteen ;  in  1907  they 
intervened  in  thirty-nine  cases  and  settled  thirty-two ;  while  during  the 
first  eight  months  of  1908  no  fewer  than  forty-seven  cases  of  intervention 
have  occurred,  of  which  thirty-five  have  already  been  settled,  while  some 
of  the  remainder  are  still  being  dealt  with. 

Believing  that  the  time  has  now  arrived  when  the  scale  of  these 
operations  deserves  the  creation  of  some  more  formal  and  permanent 
machinery,  he  has  decided  to  set  up  a  standing  court  of  arbitration. 


ENGLAND.  OO 

Accordingly,  early  in  October,  1908,  he  nominated  three  panels  of  about 
fifteen  members  each,  the  first  panel  (of  chairmen)  being  persons  of 
eminence  and  impartiality,  the  second  panel  being  drawn  from  the 
' '  employers '  class, ' '  and  the  third  panel  from  the  class  of  workmen  and 
trade  unionists.  The  court  will  sit  wherever  required,  composed  of 
three  or  five  members,  according  to  the  wishes  of  the  parties,  with  fees 
and  expenses  to  the  members  of  the  court  and  the  chairman  during  the 
sittings.  This  court  will  be  nominated  from  the  foregoing  three  panels 
by  the  board  of  trade. 

Many  in  England  look  with  favor  on  this  new  plan  and  have  great 
hopes  of  it  achieving  large  and  important  results  in  further  reducing 
the  number  of  strikes  and  lockouts.  In  the  opinion  of  some  of  the 
members  of  the  London  Chamber  of  Commerce,  who  have  had  long  expe- 
rience with  their  own  peculiar  plan  herein  described,  the  probable  point 
of  failure  in  the  new  board  of  trade  scheme  will  be  the  panel  comprised 
of  persons  of  eminence  and  impartiality  from  whom  the  chairmen  are  to 
be  chosen.  In  the  opinion  of  the  expert  critics  of  the  London  Chamber 
of  Commerce  the  plan  would  be  much  stronger  and  likely  to  prove  more 
efficacious  if,  in  accordance  with  their  own  plan  of  operations,  there 
were  but  two  panels  out  of  which  the  court  was  to  be  chosen — employers 
and  workmen. 

The  most  important  factor,  however,  in  the  progress  made  along  the 
lines  of  conciliation  and  arbitration  has  been  the  attitude  of  the  British 
labor  unions  themselves.  Article  3,  rule  1  of  the  by-laws  of  the  General 
Federation  of  Trade  Unions  reads :  "  It  is  the  purpose  of  the  General 
Federation  to  promote  industrial  peace,  and  by  all  amicable  means, 
such  as  conciliation,  mediation,  reference,  or  by  the  establishing  of 
permanent  boards,  to  prevent  strikes  and  lockouts  between  employers 
and  workmen,  or  disputes  between  trades  or  organizations;  where 
differences  do  occur  to  assist  in  their  settlement  by  just  and  equitable 
methods." 

Nor  have  these  been  idle  words  used  for  "dress  parade"  purposes. 
The  British  Federation  of  Trade  Unions  has,  as  a  rule,  acted  up  to 
the  very  spirit  of  this  by-law,  and  has  left  nothing  undone  to  settle 
labor  disputes  peacefully. 

As  the  result  of  these  various  movements  eighty-nine  boards  of  con- 
ciliation and  arbitration  took  action  in  1907.  The  number  of  cases  con- 
sidered were  fifteen  hundred  and  forty-five,  out  of  which  six  hundred 
and  sixty-eight  were  settled  without  stoppage  of  work.  Only  seven 
cases  involved  a  stoppage  of  work.  In  seven  hundred  and  seventy- 
eight  cases  the  questions  in  dispute  were  either  withdrawn  or  settled 
independently,  eighty-eight  cases  being  still  under  consideration  at  the 
close  of  the  year. 

At  this  writing  there  are,  according  to  the  latest  government  report, 


56  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

two  hundred  and  nine  boards  of  conciliation  and  arbitration  in  the 
United  Kingdom. 

The  last  report  of  the  Board  of  Trade  for  1907  states  that  58.80  per 
cent  of  workers'  wages  have  been  changed  through  the  medium  of  con- 
ciliation. As  an  illustration  of  the  growth  in  the  last  ten  years  of 
conciliation  as  a  means  for  the  peaceful  adjustment  of  questions  of 
wages,  the  following  comparative  statement  is  taken  from  the  1907 
report  of  the  Board  of  Trade : 

Tear.  Number.*     Percentage. 

1898 32,514  3.2 

1907 . 732,768  58.8 

COMPULSORY  ARBITRATION. 

I  found  but  one  labor  authority  in  my  British  investigations  who 
favored  compulsory  arbitration:  The  Honorable  Mr.  Pe.mber  Reeves, 
High  Commissioner  for  New  Zealand,  through  wrhose  efforts,  while  Labor 
Minister  in  New  Zealand,  the  compulsory  arbitration  laws  of  that 
colony  were  passed  in  1895.  To  him  it  seemed  passing  strange,  if  not 
incomprehensible,  why  British  \vage-earners  should  oppose  compulsory 
arbitration  with  the  record  before  them  in  New  Zealand  of  an  increase 
in  the  trade  union  membership  under  compulsory  arbitration  of  from 
ten  thousand  to  thirty-three  thousand.  He  acknowledged  that  some 
weak  spots  had  broken  out  in  the  New  Zealand  laws  during  the  past 
year,  but  he  maintained  that  the  New  Zealand  legislature  was  earnestly 
at  work  strengthening  these  weak  spots,  and  that  he  was  confident  that 
they  would  succeed  in  so  amending  the  existing  law  that  every  decision 
of  the  court  of  compulsory  arbitration  could  be  successfully  enforced 
against  employers  and  workmen. 

I  found,  however,  that  Mr.  Reeves  stands  practically  alone  in  this 
opinion.  All  the  other  labor  authorities  that  I  was  enabled  to  meet 
while  in  England  gave  it  as  their  unqualified  opinion  that  no  com- 
pulsory arbitration  law  could  be  framed  that  would  compel  men  to 
go  to  work  when  they  did  not  want  to  work,  and  that  a  compulsory 
arbitration  law  was  of  no  practical  value,  if  labor,  as  well  as  capital, 
could  not  be  compelled  to  abide  by  the  court  decisions,  and  that,  in 
any  event,  so  far  as  their  opinions  went,  compulsory  arbitration  in  the 
United  Kingdom  was  neither  desirable  nor  practicable. 

There  seems,  however,  to  be  a  growing  interest  on  the  part  of  the 
British  employers  and  workmen  in  the  matter  of  compulsory  inquiry 
in  dealing  with  cases  where  one  side  or  the  other,  or  both,  are  not 
amenable  to  conciliation  and  arbitration.  It  is  along  these  lines  that 
I  hope  to  make  further  investigations  when  I  reach  those  great  experi- 
mental grounds  for  modern  and  progressive  labor  legislation,  Australia 
and  New  Zealand. 

*Number  of  wage-earners  whose  wages  were  arranged  by  conciliation  boards, 
mediation  and  arbitration. 


VICTORIA,  AUSTRALIA.  57 


VICTORIA,  AUSTRALIA. 


The  commonwealth  of  Australia  is  composed  of  the  six  following 
states:  New  South  Wales,  Victoria,  Queensland,  South  Australia, 
West  Australia,  and  Transmania.  The  estimated  population  of  the  com- 
monwealth at  the  end  of  1907  was  4,197,037.  This,  with  its  area  of 
2,974,581  square  miles  gives  it  a  population  of  1.41  persons  to  the 
square  mile  against  a  population  of  28  persons  to  the  square  mile  in 
the  United  Stales.  The  most  densely  populated  states  in  the  Aus- 
tralian commonwealth  are  New  South  Wales,  with  its  1,568,942  people 
in  1907,  and  Victoria,  with  its  population  for  the  same  year  of  1,248,095. 

These  two  states  are  also  the  most  important  in  the  commonwealth, 
commercially  and  industrially.  By  confining  the  time  at  my  command 
to  investigating  the  labor  laws  and  labor  conditions  in  these  two  chief 
centers,  I  feel  I  have  been  able  to  get  a  more  comprehensive  knowledge  of 
such  Australian  labor  laws  and  labor  conditions  as  are  likely  to  prove 
helpful  to  California  than  if  I  had  attempted  to  spread  my  time  over  a 
wider  and  thinner  area  in  the  commonwealth. 

I  shall  deal  first  with  the  State  of  Victoria,  because  it  was  the  first 
government  to  legislate  on  labor  questions,  and  in  some  directions  it  has 
been  the  pioneer,  leading  the  way  in  industrial  legislation  for  other 
Australasian  governments. 

THE  CONDITIONS  OF  LIFE  OF  THE  AUSTRALIAN  WORKER. 

The  conditions  under  which  the  Australian  wage-earner  lives  are 
most  favorable.  He  enjoys  a  most  salubrious  climate,  where  neither 
extreme  heat  nor  extreme  cold  need  be  provided  for.  He  can  work  out 
in  the  open,  rains  excepted,  most  every  day  in  the  year.  The  health 
of  his  people  is  most  excellent,  the  death  rate  of  Australia,  10.8  per 
thousand,  next  to  New  Zealand,  being  the  lowest  in  the  world,  and 
living  in  one  of  the  greatest  food  producing  countries,  he  commands 
good  and  abundant  food  at  a  most  moderate  cost,  while  his  wage  rates, 
next  to  America  and  NewT  Zealand,  are  the  highest  in  the  world.  These 
favorable  conditions,  combined  with  his  thrift,  sobriety,  high  intelli- 
gence and  law-abiding  qualities,  place  him  among  the  world's  wage- 
earning  aristocracy. 

POLITICAL   ACTIVITY    OF   LABOR. 

Iii  more  recent  years  through  the  growth  of  unionism,  the  wage- 
earners  have  as  a  labor  party  taken  a  most  active  interest  in  the 


58  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

political  affairs  of  the  country.  At  this  writing  there  are  now  but  two 
political  parties  in  the  commonwealth  of  Australia,  the  Labor  party  and 
the  Coalition  party,  which  latter  consists  of  the  free  traders  and  the 
protectionists,  who  within  this  past  week  have  united  in  order  to  oust 
the  Labor  administration  from  power,  after  it  has  been  occupying  the 
administrative  saddle  for  many  months,  where  it  surprised  its  enemies 
and  gratified  its  friends  by  the  wisdom  and  conservativeness  of  its 
administration. 

CHARACTER   OP   AUSTRALIAN   LABOR   LEADERS. 

The  Australian  labor  leaders  have  shown  unusual  ability  and  high 
integrity  and  when  placed  in  political  power,  have  commanded  the 
respect  of  even  their  political  opponents,  by  their  honesty,  their  earnest- 
ness and  the  fidelity  displayed  to  their  public  trust. 

TRADE   UNIONISM    AND   LABOR   LEGISLATION. 

The  history  and  scope  of  Victorian  trades  unions  and  labor  legisla- 
tion is  briefly  told  in  the  Commonwealth  Yearbook  for  1909,  from  which 
I  take  the  following: 

DEVELOPMENT  OF  TRADES   UNIONS   IX  AUSTRALIA   IX  GENERAL. 

(Official  Yearbook  of  Australia,  p.  104.) 

In  Australia,  industrial  unionism  paved  the  way  to  industrial  legislation.  Con- 
ditions of  employment  were  on  the  whole  favorable  to  the  investigation  of  industrial 
problems  and  the  experimental  legislation  was  possible  because  of  the  simplicity  and 
and  directness  of  aim  of  those  engaged  in  industrial  occupations.  Moreover,  the  non- 
existence  of  the  complexity  of  the  problems  and  of  the  organizations  of  the  older 
countries  did  not  impose  the  difficulties  that  might  otherwise  have  operated.  Hence 
also  rapid  changes  in  the  laws  governing  industry  occur  and  are  likely  to  occur.  To 
a  great  extent  the  trades  unions  were  responsible  for  these  laws.  They  steadily  and 
continuously  urged  an  amelioration  of  the  condition  of  the  workingman,  and  by 
organization  and  discipline  they  presented  a  united  front  to  opposing  forces  and 
obtained  many  advantages  by  a  recognition  of  the  principle  that  union  is  strength. 
Their  efforts  have  resulted  in  improved  conditions,  particularly  short  hours  and 
a  healthier  mode  of  life.  One  great  aim  of  present  day  industrial  legislation  has 
been  said  to  be  to  extend  "The  reasonable  comforts  of  a  civilized  community''  to 
those  engaged  in  every  branch  of  industry.  Large  organizations  have  been  able  to 
obtain  their  ends  by  force  of  numbers,  and,  in  the  case  of  the  great  bulk  of  the 
artisan  and  similar  classes,  through  the  solidity  of  their  unions.  The  smaller  and  less 
perfectly  organized  industries,  unable  to  maintain  an  effectual  struggle  with  hope  of 
success,  are  now  receiving,  by  legislative  enactment,  the  benefits  already  secured  to 
trades  unions. 

While  the  demands  of  the  early  unions  have  almost  in  their  entirety  been  conceded 
by  the  employers,  unionism  nevertheless  continues.  Industrial  legislation  has  not  yet 
reached  the  stage  when  the  conflicts  between  employer  and  employee  cease.  A 
numerically  strong  union  will  sometimes  obtain  its  end  by  the  threat  and  sometimes 
by  the  fulfillment  of  the  threat  of  a  strike. 

(Yearbook,  p.   1049.) 

The  first  Melbourne  eight-hour  procession  was  held  in  1S56,  the  trades  taking 
part  being  the  masons,  bricklayers,  carpenters,  joiners,  plasterers,  painters  and 
slaters.  In  the  following  year  about  700  men  took  part  in  the  function,  but  the 
principle  of  the  eight-hour  day  had  been  recognized,  and  new  unions  were  quickly 
established  under  the  influence  and  guidance  of  the  pioneers  of  the  movement. 


VICTORIA,  AUSTRALIA.  59 

(Yearbook,  p.  1064-6.) 

Two  systems,  based  on  different  principles,  exist  in  Australia  for  the  regu- 
lation of  wages  and  general  terms  of  contracts  of  employment.  A  "wages  boards" 
system  exists  in  New  South  Wales,  Victoria,  Queensland,  and  South  Australia, 
and  an  arbitration  court  in  Western  Australia.  In  New  South  Wales  the  Indus- 
trial Arbitration  Acts  of  1901  and  1905  instituted  an  arbitration  court.  This 
court  expired  on  June  30,  1908,  having  delivered  its  last  judgment  on  the  previous 
day.  Wages  boards  were  substituted  under  the  Industrial  Disputes  Act,  1908. 
There  is  also  the  arbitration  court  of  the  commonwealth,  which  has  power,  however, 
to  deal  only  with  matters  extending  beyond  the  limits  of  a  single  state. 

Wages  Boards. — This  system  was  introduced  into  Victoria  by  the  Factories  and 
Shops  Act  of  1896.  The  original  bill  made  provision  only  for  the  regulation  of  the 
wages  of  women  and  children,  but  was  afterwards  amended  in  Parliament  to  extend 
the  system  to  adult  operatives  of  both  sexes. 

The  act  of  1896  made  provision  for  the  regulation  of  wages  only  in  the  clothing 
and  furniture  trades,  and  in  the  bread-making  and  butchering  trades.  By  the  act  of 
1900  the  operations  of  the  act  were  extended  to  include  all  persons  employed  either 
inside  or  outside  a  "factory"  or  "workshop"— section  4,  i.  (a) — in  any  trade  usually 
carried  on  therein.  This  section  is  now  in  the  act  of  1905.  An  act  of  1907  extended 
the  system  to  trades  and  businesses  not  connected  in  any  way  with  factories,  making 
provision  for  the  appointment  of  wages  boards  for  shop  employees,  carters  and 
drivers,  persons  employed  in  connection  with  building  and  quarrying,  or  the  prepara- 
tion of  firewood  for  sale,  or  the  distribution  of  wood,  coke  or  coal.  It  is  proposed  to 
extend  the  system  to  mines,  provisions  to  do  so  being  made  in  the  mines  bill  intro- 
duced into  Parliament. 

The  regulation  is  made  by  a  board,  called  a  special  board,  to  distinguish  it  from 
the  board  of  health.  Boards  for  the  regulation  of  wages  in  the  trades  specified  in 
the  act  of  1896  are  appointed  as  a  matter  of  course,  and  by  the  executive 
other  boards  are  appointed  only  if  a  resolution  for  appointment  be  passed  by  both 
houses  of  Parliament.  A  board  consists  of  from  four  to  ten  members  who  must  be 
or  must  have  been  at  a  recent  time  prior  to  the  appointment  engaged  in  the  trade 
concerned.  Employers  and  employees  are  equally  represented.  If  one  fifth  of  the 
employers  or  the  employees  object  to  a  representative  nominated  for  them  they  can 
elect  one.  Originally  the  board  was  elected  in  the  first  instance,  but  the  difficulty  in 
compiling  the  electoral  roll  led  to  the  adoption  of  the  present  system,  which  has 
proved  satisfactory.  The  furniture  board  is  nominated  outright  owing  to  the  pre- 
ponderance of  Chinese.  An  independent  chairman,  nominated  by  the  board,  is 
appointed  by  the  executive.  A  board  holds  office  for  three  years. 

The  board  has  power  to  determine  the  lowest  wages  or  prices  or  rates  to  be  paid 
to  any  persons  or  classes  of  persons  coming  within  the  act,  for  wholly  or  partly  pre- 
paring, manufacturing,  or  repairing  articles,  or  for  other  services  rendered,  and  may 
fix  special  rates  for  old,  slow  or  infirm  workers. 

The  board  fixes  the  hours  of  work,  and  may  limit  the  number  of  "improvers"  to 
be  employed  (usually  done  by  prescribing  the  number  to  each  journeyman  employed). 
There  is  no  power  in  Victoria  to  limit  the  number  of  apprentices  employed.  Such 
power  exists  in  South  Australia.  The  board  fixes  the  wages  of  apprentices  and 
improvers  according  to  age,  sex,  and  experience,  and  may  fix  a  graduated  scale  of 
wages  calculated  on  the  same  basis.  Apprentices  bound  for  less  than  three  years  an; 
improvers,  unless  the  minister  sanctions  a  shorter  period  of  apprenticeship  on  account 
of  previous  experience  in  the  trade.  The  minister  may  sanction  the  employment  of  an 
improver  over  twenty-one  years  of  age  at  a  rate  proportionate  to  his  experience. 
Outworkers,  in  the  clothing  trade,  must  be  paid  piece  rates.  Manufacturers  may,  by 
leave  of  the  board,  fix  their  own  piece  rates,  if  calculated  on  the  average  wages  of 
time  workers  as  fixed  by  the  board. 

Licenses  for  twelve  months  to  work  at  a  fixed  rate  lower  than  the  minimum  rate 
may  be  granted  by  the  chief  inspector  of  factories  to  persons  unable  to  obtain 
employment  by  reason  of  age,  slowness  or  infirmity.  Licenses  are  renewable. 

Determinations  remain  in  force  till  altered  by  the  board  or  by  the  court  of  appeal. 


60  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

These  determinations  apply  to  all  cities  and  towns  and  to  such  boroughs  as  the 
executive  may  determine,  and  the  executive  may  also  apply  theni  to  any  shire  within 
ten  miles  of  a  city  or  town,  if  the  shire  council  petition  to  that  effect.  (Similar 
provisions  are  in  force  in  other  states.) 

The  children  of  an  employer  are  exempt  from  a  determination. 

The  executive  may  direct  a  board  to  fix  outworkers'  rates  and  the  rates  payable 
in  allied  trades.  Boards  are  given  power  to  fix  the  wages  to  be  paid  to  persons 
employed  on  repairs. 

Penalties  are  fixed  for  the  direct  or  indirect  contravention  of  determinations, 
the  obedience  to  which  is  ascertained  by  the  examination  of  the  records  of  wages, 
etc.  (Section  4,  i,  a.) 

A  court  of  appeal,  consisting  of  a  supreme  court  judge,  has  power  to  review  the 
determination  of  the  boards.  The  court  may  appoint  assessors  to  assist  the  judge. 

The  act  fixes  an  absolute  weekly  minimum  wage,  and  evasion  of  this  provision  in 
the  case  of  females  employed  in  the  clothing  trade  by  charging  an  apprenticeship 
premium,  is  prevented  by  the  prohibition  of  all  such  premiums  in  that  particular 
case. 

WAGES     BOARDS. 
(Yearbook,  p.   1079.) 

Wages  boards  are  appointed  upon  application  of  either  employers  or  employees. 
The  grounds  usually  urged  by  the  former  is  that  their  business  is  hampered  by 
unfair  competitors,  who  pay  only  a  sweating  wage ;  by  the  latter  that  they  are 
sweated  or  are  entitled  to  a  consideration  of  their  wages,  by  reason  of  the  prosperity 
of  the  trade  in  which  they  are  employed. 

According  to  the  latest  Yearbook  there  are  146.000  industrial  workers  in  Victoria 
out  of  which  the  following  number  are  employed  in  registered  factories : 

Total  number  of  distinct  trades  carried  on  in  registered  factories  152 

Total  trades  under  boards  51 

Total   factories   registered   5,003 

Total   employees   . 71,968 

Total  employees  under  wages  boards -_-  56,994 

Percentage  under  boards 80 

Number  of  determinations  48 

The  following  table  shows  the  number  of  convictions  for  disobedience  to  deter- 
minations of  boards  (not  including  overtime  working)  : 

1901 34  1905 27 

1902 33  1906 52 

1903 41  1907 43 

1904 39 

WAGES. 

The  tendency  of  wages  here  as  elsewhere  in  the  industrial  world,  has 
during  the  past  decade  been  upward.  As  shown  by  a  table  published 
in  the  Melbourne  Age  of  March,  1909,  by  Gr.  M.  Pendergast,  labor  leader 
and  member  of  Parliament  of  Victoria,  the  wages  in  sixty-two  indus- 
tries have  increased  on  an  average  15.665  per  cent  since  the  awards  of 
the  wages  boards  dealing  with  these  industries  have  gone  into  effect. 
Among  the  wages  quoted  in  the  foregoing  article  is  to  be  noted  the 
following  per  week: 

Shoemakers $12.00  Brickmakers $11.33 

Cigarmakers  8.81  Ironmolders    10.27 

Printers    10.33  Saddlery  S.16 

Stonecutters  12.04  Tinsmith    7.7." 

Woodworkers  _  10.72 


VICTORIA,  AUSTRALIA.  61 

The  wages  of  highly  skilled  labor,  according  to  Secretary  Barker  of  the 
Melbourne  Labor  Council,  is  from  10  to  12  shillings  ($2.40  to  ($2.88)  a 
day,  and  for  unskilled  labor  from  7  to  9  shillings  ($1.68  to  $2.16)  a  day. 

HOURS   OF   LABOR. 

An  eight-hour  day  was  established  in  Victoria  in  the  building  trades 
in  1856.  The  average  hours  in  the  building  trades  in  the  United  States 
so  late  as  1890  were  fifty-four  per  week,  and  at  the  end  of  1903,  forty- 
eight  hours  a  week,  a  stage  which  Victoria  reached  fifty-three  years  ago. 

The  Commonwealth  Yearbook  for  1909,  page  1049,  tells  the  story  of 
the  eight-hour  day  as  follows : 

COMMENCEMENT  OF  THE  EIGHT-HOUE   SYSTEM. 

The  first  trade  union  in  Australia  was  the  "Operative  Masons  Society,"  established 
in  Melbourne  in  1850.  In  1851  a  branch  of  the  "English  Amalgamated  Society  of 
Engineers"  was  founded  in  Sydney.  For  many  years  practically  the  only  unions 
existing  were  those  formed  by  the  several  branches  of  the  building  trades.  They 
were  all  subject  to  the  English  law  prohibiting  conspiracies  and  combinations  in 
restraint  of  trade,  though  it  does  not  appear  that  any  such  law  was  ever  put  in 
force  in  Australia.  The  main  object  of  the  early  unions  in  Australia  was  the  limita- 
tion of  the  working  week  to  forty-eight  hours.  The  minor  and  friendly  society 
benefits  that  were  usual  among  the  unions  of  older  countries  were  also  desired ;  but 
the  chief  aim  was  the  establishment  of  the  eight-hour  principle,  and  that  aim  for 
many  years  was  the  chief  link  between  the  unions.  It  is  difficult  to  obtain  detailed 
information  concerning  the  unions  prior  to  trade  union  legislation,  but  their  early 
history  generally  resolves  itself  into  an  account  of  the  early  efforts  put  forth  by 
metropolitan  operatives  to  secure  the  limitation  of  the  working  day  to  eight  hours. 

COST    OF    LIVING. 

During  the  past  decade  the  cost  of  living,  including  rent,  has  advanced. 
There  are  no  reliable  statistics  to  tell  just  what  percentage  of  increase 
has  taken  place. 

From  the  consensus  of  opinions  expressed  by  men  in  various  walks  of 
life,  I  should  say  that  while  in  some  things,  especially  in  the  matter  of 
rent,  the  cost  has  increased  beyond  the  increase  in  the  wage  rate,  yet  on 
the  whole,  the  gain  in  wages  has  covered  the  increased  cost  of  living  and 
left  a  small  margin  besides. 

THE    ATTITUDE    TOWARD    UNION    LABOR. 

The  attitude  of  the  Victorian  public  toward  labor  organizations  is 
friendly.  Some  employers  are  hostile  to  labor  legislation  rather  than  to 
labor  unions.  Other  employers  maintain  that  labor  in  Victoria  is 
despotic  and  unreasonable ;  yet  other  employers  admit  that  the  conserv- 
ative rich  want  to  keep  labor  permanently  in  its  place  and  within  its 
class,  on  the  other  hand,  that  labor  Socialists  are  preaching  class  con- 
sciousness. Still  other  employers  contend  that  much  friction  and  ill  will 
is  caused  by  virtue  of  the  fact  that  there  is  no  finality  to  the  demands 


62  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

of  labor.  Professor  Moore,  of  the  University  of  Melbourne,  gave  it  as 
his  opinion  that  the  relations  between  employers  and  their  men  were 
strained  and  likely  to  become  more  so.  Chief  Factory  Inspector  Ord, 
who  because  of  his  official  position  has  an  unusual  opportunity  of  getting 
in  touch  with  employers  and  their  men,  expressed  the  view  that  so  far 
as  the  manufacturing  industries  of  the  state  are  concerned,  the  relations 
between  employers  and  their  men  are  not  of  an  unfriendly  character. 

EMPLOYERS'  ASSOCIATIONS. 

Employers  are  organized  for  the  purpose  of  meeting  and  offsetting 
claims  of  unionists  before  wages  boards.  Their  organizations,  how- 
ever, are  said  to  be  not  nearly  so  comprehensive  or  effective  as  those  of 
the  men. 

' '  CLOSED  SHOP.  ' ' 

There  are  comparatively  few  "closed"  shops  in  Victoria.  Union 
and  nonunion  wage-earners,  as  a  rule,  work  side  by  side. 

STRIKES  AND  LOCKOUTS. 

There  were  no  strikes  in  Victoria  in  1908,  except  of  a  trifling  char- 
acter or  brief  duration,  not  over  1,000  workers  being  involved.  No 
official  record  is  kept  in  Victoria  of  strikes  and  lockouts,  due  to  the  fact 
that  there  have  been  so  few  in  the  state  during  the  past  twelve  years, 
not  over  eight  or  nine  in  all. 

Chief  Factory  Inspector  Ord,  in  his  report  for  1907,  says : 

It  has  never  been  claimed  by  those  in  favor  of  wages  boards  that  the  system 
will  stop  strikes,  but  for  ten  years  no  strike  of  any  importance  took  place,  and  it 
was  thought  that  by  merely  bringing  employers  and  employees  together  to  discuss 
wages,  the  chances  of  a  strike  would  be  greatly  reduced. 

Until  the  last  Parliament  there  was  no  reference  to  strikes  in  the  Factories  and 
Shops  Act,  but  the  legislature  has  now  given  the  governor  in  council  the  power  to 
suspend  a  determination  of  a  board  or  of  a  court,  for  any  period  not  exceeding 
twelve  months,  when  a  strike  or  organized  industrial  dispute  is  about  to  take  place, 
in  connection  with  any  trade  or  business,  subject  to  the  decision  of  a  board  or  the 
industrial  court  of  appeals. 

So  far  as  employees  are  concerned,  the  only  effect  of  such  a  provision  is  that  the 
men  affected  run  the  risk  of  losing  the  benefits  of  the  determination  of  a  board  for 
twelve  months. 

As  regards  the  employers,  however,  the  results  are  more  far  reaching.  They  are 
at  liberty  to  engage  men  at  such  rates  as  may  be  agreed  upon,  instead  of  being 
compelled  to  pay  the  rates  fixed  by  the  board  for,  possibly,  inferior  and  emergency 
labor. 

STRIKING   AGAINST   LEGAL   AWARDS. 

The  only  Victorian  instance  on  record  in  twelve  years  of  men  striking 

against  a  legal  award  was  in  the  case  of  the  Melbourne  bakers,  who,  in 
the  end,  won  their  strike. 


VICTORIA,  AUSTRALIA.  63 

The  story  of  this  strike  is  herewith  told  by  Chief  Factory  Inspector 
Ord  in  his  report  for  1907. 

DKEAD     BOARD. 

(Chief  Factory  Inspector's  Report  for  1907,  pp.  18-19,  Appendix  "B,"  Victoria  Report.) 

For  the  first  time  in  ten  years  a  strike  of  some  importance  took  place  in  a  trade 
under  a  special  board.  It  is  a  remarkable  thing,  however,  that  the  strike  was  not 
against  the  determination  of  the  bread  board,  but  in  consequence  of  the  court  of 
industrial  appeal  altering  a  determination  of  the  board.  The  bread  board  on  the 
casting  vote  of  the  chairman  raised  the  wages  of  journeymen  from  £2  10s.  per  week 
of  forty-eight  hours  to  £2  14s.  per  week.  This  determination  was  dated  12th  of 
June,  1907,  and  came  into  force  on  the  5th  of  August,  1907. 

On  the  15th  of  August  the  employers'  representatives  on  the  board  appealed, 
under  provisions  of  section  123  of  the  "Factories  and  Shops  Act,  1905,"  to  the 
court  against  the  increase  of  wages  allowed  by  the  board. 

The  court  (Mr.  Justice  Hood)  after  hearing  the  evidence,  reduced  the  wages 
from  £2  14s.  to  £2  10s.  from  the  15th  of  September,  1907. 

It  will  be  seen  that  from  the  5th  of  August  to  the  15th  of  September  the  men 
had  been  receiving  the  increased  wage  allowed  by  the  board.  This  fact,  no  doubt, 
had  a  great  deal  to  do  with  the  action  of  the  union  later  on,  as  men  do  not  willingly 
submit  to  a  reduction  of  wages,  no  matter  'how  obtained,  and  in  this  case  it  had 
been  granted  by  a  tribunal  appointed  by  Parliament  for  the  fixing  of  wages. 

In  any  case  as  soon  as  the  employers  reduced  the  wages  of  the  union  men  to 
£2  10s.  per  week,  the  union  intimated  that  unless  the  men  were  paid  at  the  wages 
fixed  by  the  board  the  members  of  the  union  would  be  called  out. 

The  employers,  having  secured  a  favorable  decision  from  the  court  of  industrial 
appeals,  refused  to  give  way,  and  the  union  at  once  called  out  all  the  men  over  whom 
it  had  control. 

The  strike  commenced  on  the  29th  of  September.  It  was  not  of  long  duration. 
On  the  2d  of  October  the  majority  of  the  employers  concerned  granted  the  demands 
of  the  union,  and  the  strike  was  over. 

All  those  who  are  sincerely  desirous  of  the  success  of  the  wages  board  system 
can  not  but  regret  the  occurrence  of  this  strike.  At  the  same  time  it  must  not  be 
forgotten  that  the  strike  was  not  against  the  decision  of  the  wages  board,  but  against 
that  of  the  court  of  appeal. 

STATE    CONCILIATION   AND   ARBITRATION. 

The  only  provision  for  State  intervention  in  labor  disputes  is  through 
the  medium  of  wages  boards  and  an  industrial  court  of  appeals,  as 
described  above. 

Wage-earners  are  anxious  to  have  the  industrial  court  of  appeals 
abolished  and  to  make  the  decision  of  the  wages  boards  final,  but  there  is 
no  likelihood  of  the  abolition  of  this  court,  as  employers  would  strongly 
oppose  such  action. 

COMPULSORY  ARBITRATION. 

Victoria  has  never  had  compulsory  arbitration.  Many  wage-earners 
favor  its  adoption  on  the  grounds,  as  they  claim,  that  it  stands  for 
giving  labor  unionists  a  preference  in  employment,  and  that  it  also 
limits  the  number  of  apprentices.  Victorian  employers,  on  the  other 
hand,  are  much  opposed  to  the  adoption  of  compulsory  arbitration,  and 
if  any  attempt  were  made  to  introduce  it,  would  bitterly  fight  the  pro- 
osal.  Victorian  employers  agree  that  while  the  best  conceivable  con- 


- 


64  REPORT  OF  SPECIAL  LABOR  COMMISSIONER, 

dition  in  dealing  with  labor  is  to  let  the  law  of  supply  and  demand 
prevail,  they  are  practically  unanimous  in  the  opinion  that  wages  boards 
from  their  point  of  view  are  a  lesser  evil  than  compulsory  arbitration. 
Secretary  Walpole  of  the  Employers'  Association  of  Melbourne  says: 
Of  all  experimental  legislation  concerning  wages,  hours,  and  conditions, 
that  has  been  and  is  in  force  in  this  country,  wages  boards  are  the 
fairest  and  have  the  best  record  of  administration. 

THE  EFFICIENCY  OF  LABOR. 

Labor  representatives  claim  that  unionism  in  Victoria  has  increased 
the  efficiency  of  labor.  Some  employers  claim  it  has  slightly  decreased 
it.  Yet  other  employers  hold  that  it  has  not  affected  labor  efficiency 
one  way  or  the  other.  Ernest  Aves  in  his  report  to  the  British  Parlia- 
ment under  date  of  March,  1908,  quotes  a  Victorian  clothing  manufac- 
turer as  saying  that  wages  in  his  trade  had  increased  twenty  per  cent 
and  that  cost  of  manufacturing  had  decreased  thirty-five  per  cent, 
largely  due  to  increased  efficiency. 

THE  INFLUENCE  OF  VICTORIAN  LABOR  LEGISLATION  ON  THE  UNSET- 

TLEMENT  OF  BUSINESS. 

While  some  Victorian  employers  contend  that  the  labor  laws  have 
tended  to  unsettle  business,  I  was  unable  to  obtain  any  tangible  evidence 
of  this.  On  the  contrary,  so  far  as  I  could  find,  Victorian  employers 
have  enjoyed  a  far  higher  degree  of  industrial  peace  in  the  past  twelve 
years  than  has  been  enjoyed  by  employers  in  Europe  or  in  the  United 
States. 

This,  in  my  opinion,  is  very  largely  due  to  its  existing  labor  legisla- 
tion, which  has  furnished  legal  machinery  for  the  prompt  adjustment  of 
the  vexed  questions  of  wages  and  hours,  thus  preventing  almost  entirely 
a  resort  to  strikes  and  lockouts. 

The  Victorian  employers  who  contend  that  its  labor  legislation  and 
the  wages  boards  have  tended  to  unsettle  business,  and  who  would  prefer 
to  let  the  laws  of  labor  supply  and  demand  prevail  untrammeled,  do 
not  seem  to  realize  that  the  most  disturbing  industrial  elements  are 
strikes  and  lockouts,  and  that  where  the  State  fails  to  furnish  legal 
machinery  for  the  settlement  of  labor  disputes,  but  leaves  such  settle- 
ment to  the  law  of  labor  supply  and  demand,  strikes  and  lockouts 
prevail  at  a  frightful  cost  to  labor,  to  capital,  and  to  the  body  politic 
generally. 

While  there  is  nothing  in  the  law  to  prevent  the  Victorian  labor 
unions  from  stepping  in  and  disturbing  the  otherwise  harmonious 
relations  existing  between  an  employer  and  his  men,  there  were  no 
cases  brought  to  my  notice  where  this  had  taken  place.  The  fact  that 


VICTORIA,  AUSTRALIA.  65 

the  Minister  of  Labor,  under  the  law,  has  the  power  to  suspend  for 
twelve  months  wages  board  determinations,  if  an  organized  strike  is 
threatened  or  takes  place,  seems  to  have  a  great  restraining  influence 
on  hasty  or  thoughtless  action  on  the  part  of  overzealous  wage-workers 
or  their  leaders. 

Under  the  wages  board  system  there  is  little  or  no  occasion  for  the 
unsettlement  or  disturbance  of  industrial  affairs,  because  with  its  per- 
manent separate  wages  board,  composed  of  representatives  of  employers 
and  workers  in  the  trade,  presided  over  by  an  impartial  chairman,  quick 
action  is  possible,  so  that  a  congestion  of  cases  with  the  consequent 
delay  in  a  decision  of  months  and  sometimes  years,  such  as  have  taken 
place  in  New  South  Wales  and  in  New  Zealand,  under  the  former  laws 
relating  to  compulsory  arbitration,  becomes  impossible. 

Victorian  labor  laws  do  not  make  for  absolute  certainty  in  business 
because  the  wages  board  has  the  right  from  time  to  time  to  increase  or 
decrease  the  minimum  wage.  On  the  other  hand,  it  does  make  for  a  far 
higher  degree  of  certainty  than  where  there  is  no  legal  wage  established 
and  where  strong  unions  can,  without  State  intervention,  demand  an 
immediate  increase  in  wages.  Under  the  wages  board  system,  the  matter 
of  an  increased  wage  must  be  inquired  into  by  a  board  upon  which 
employers  and  men  are  represented,  an  agreement  reached,  and  a 
decision  rendered  by  the  chairman,  subject  to  the  approval  on  appeal 
to  the  industrial  court  of  appeal,  thus  affording  the  employer  a  reason- 
able protection  against  unreasonable  demands,  and  thus  also  protecting 
the  wage- worker  against  a  hasty  or  ill  judging  strike  which  may  subject 
him  to  irreparable  loss  and  injury. 

DOES  THE  LAW  ENCROACH  ON  THE  LIBERTY  OF  PERSON  AND  PROPERTY 
OR  USURP  THE  MANAGEMENT  OP  AN  EMPLOYER 's  BUSINESS  ? 

In  common  with  most  laws,  wages  boards  encroach  upon  the  liberty 
of  persons  and  property,  but  in  return  for  this  seeming  loss  they  afford 
the  worker  and  his  employer,  as  well  as  the  community,  a  very  high 
degree  of  industrial  peace. 

The  greatest  sufferers  under  the  law  are  the  unfair  employers  who 
endeavor  for  profit  to  evade  its  provisions  or  the  determinations  of  the 
wages  boards,  and  who,  when  convicted,  are  penalized  by  the  court. 

The  law  so  far  interferes  with  private  business  management  as  to 
determine  the  least  but  not  the  most  it  can  pay  for  its  labor,  the 
number  of  apprentices  it  can  employ,  and  so  on.  In  effect,  it  interferes 
with  private  management  to  the  degree  that  a  strong  American  labor 
union  interferes  with  private  management,  with  the  difference,  however, 
that  strong  labor  unions  will  frequently  fix  conditions  regardless  of  the 
views  of  employers;  whereas,  under  the  wages  board  system,  the  em- 


66  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

ployer  in  common  with  the  worker  has  a  voice  in  determining  these 
matters. 

CAN  EMPLOYEES  OBTAIN   EMPLOYMENT   EXCEPT   UPON   TERMS   FIXED 

BY  THE  COURT? 

The  system  is  hardest  upon  the  slow  or  inefficient  worker  who  can 
not  make  himself  worth  the  minimum  wage  fixed  by  the  wages  board. 
This  sort  of  worker  must  obtain  a  special  legal  permit  from  the  Chief 
Factory  Inspector,  allowing  him  to  work  for  less  than  the  legal  minimum 
wage,  which  permit  can  be  issued  under  the  following  act : 

OLD,    SLOW  AND  INFIRM  WORKERS. 
(Factories  and  Shops  Act,   1975,   clause  7,  par.   99%,  part  IX.) 

If  it  is  proved  to  the  satisfaction  of  the  chief  inspector  that  any  person  by  reason 
of  age,  slowness,  or  infirmity  is  unable  to  find  employment  at  the  minimum  wage 
fixed  by  the  special  board,  the  chief  inspector  may  in  such  case  grant  to  such  aged, 
slow  or  iafirm  worker  a  license  for  twelve  months  to  work  at  a  less  wage  (to  be 
named  in  such  license)  than  the  said  minimum  wage,  and  such  license  may  be 
renewed  from  time  to  time. 

The  number  of  such  persons  licensed  as  slow  workers  in  any  factory  shall  not 
without  consent  of  the  minister  exceed  the  proportion  of  one  fifth  of  the  whole 
number  of  persons  employed  in  such  factory  at  the  minimum  wage  fixed  for  adults 
or  at  piecework  rates  provided  that  one  slow  worker  may  be  employed  in  any  regis- 
tered factory,  and  any  person  who  without  such  consent  employs  any  greater  number 
than  such  proportion  shall  be  guilty  of  a  contravention  of  this  part. 

In  good  times  the  slow  worker  is  the  last  to  be  put  on,  and  in  bad 
times  he  is  the  first  to  be  sent  off.  This,  as  a  rule,  will  be  his  experience 
in  most  every  country  and  under  most  all  industrial  conditions,  but 
since  he  can  not  make  his  own  bargains  here,  it  works  out  still  harder 
for  him  under  a  wages  board  law. 

ARE  AWARDS  EQUALLY  BINDING  ? 

No.  Employers  can  not  pay  less  than  the  amount  prescribed  by  the 
award.  An  employee,  however,  need  not  work  for  the  minimum  wage 
if  another  employer  is  willing  to  pay  him  more.  He  may  leave  his 
employment  as  an  individual,  but  men  can  not  leave  their  jobs  in 
concert  (which  would  be  equivalent  to  striking)  without  involving  the 
risk  of  losing  their  awards. 

The  employer  can  not  escape  by  private  agreement  paying  the  wage 
award,  as  is  shown  by  the  following  legal  provision : 

(Factories  and  Shops  Act,  1975,  part  IX,  par.  114.) 

Where  an  employer  employs  any  person  to  do  any  work  for  him  for  which  a 
special  board  has  determined  the  lowest  prices  or  rates,  then  such  employer  shall  be 
liable  to  pay  and  shall  pay  in  full  in  money  without  any  deduction  whatever  to 
such  person  the  price  or  rate  so  determined,  and  such  person  may  within  twelve 
months  after  such  money  became  due  take  proceedings  in  any  court  of  competent 
jurisdiction  to  recover  from  the  employer  the  full  amount  or  any  balance  due  in 
accordance  with  the  determination,  any  smaller  payment  or  any  express  or  implied 
agreement  or  contract  to  the  contrary  notwithstanding. 


VICTORIA,  AUSTRALIA.  1)7 

HAVE   THE   BOARDS    INCREASED   THE    COST    OF   LIVING? 

This  is  a  mooted  question  due  to  a  confusion  of  thought  on  the  part 
of  many  as  to  the  laws  of  economic  cause  and  effect.  Living  has  been 
increased  partly  by  the  enhanced  value  of  land,  due  to  increased  popu- 
lation, and  speculative  discounting  of  future  land  values,  thereby 
increasing  rent,  and  partly  because  of  the  increased  world  price  of  all 
staples,  which  so  largely  enter  into  the  wage-earner's  bill  of  consump- 
tion. These  things  in  turn,  combined  with  the  scarcity  of  labor  during 
the  highly  prosperous  period  of  the  recent  past,  have  led  to  higher 
wages,  which  in  turn,  have  had  some  influence  in  the  further  increase 
in  living  cost.  In  industrial  products  the  increased  wage  cost  has 
largely  been  offset,  however,  by  improved  labor  saving  devices,  so  that 
despite  a  higher  wage  rate,  there  has,  as  a  rule,  followed  a  very  trifling, 
if  any,  increased  industrial  labor  cost  rate. 

WAGES  BOARDS  ;  HAVE  THEY  BENEFITED  LABOR  ? 

If  we  are  to  let  the  labor  unionists  speak  for  themselves,  we  shall  find 
according  to  the  statement  made  by  the  executive  committee  of  the 
labor  council,  as  quoted  herein  under  the  chapter  of  "Wages  Board," 
that  the  wages  boards  have  created  favorable  conditions  for  the  workers 
generally  that  would  not  otherwise  have  existed. 

CAN  MEN  EVADE  THE  LAW  AND  STRIKE  ? 

Yes.  If,  however,  a  strike  occurs  in  a  trade  working  under  an  award, 
the  government  in  council,  through  the  Labor  Minister,  may  suspend 
the  whole  or  part  of  the  determination  affecting  such  trade  for  a  period 
not  exceeding  twelve  months.  The  effect  of  this  provision  is  that  if  the 
men  do  not  accept  the  decision  of  the  wages  board,  the  employers  are 
then  legally  at  liberty  to  hire  whomsoever  they  please  at  any  wages 
that  may  be  agreed  upon,  to  fill  the  places  of  the  strikers. 

DOES  THE  LAW  DRIVE  CAPITAL  OUT  OF  THE  COUNTRY? 

The  law  may  have  a  tendency  to  frighten  away  very  timid  investors, 
but  such  investors  would  be  still  more  timid  and  more  speedily  driven 
out,  in  countries  where  there  is  no  State  intervention  in  labor  disputes, 
and  where  powerful  labor  unions  are  in  a  position  to  dictate  their  own 
terms,  and  to  enforce  these  terms  by  sudden  and  disastrous  strikes. 
The  following  figures  taken  from  the  official  Yearbook  of  the  Com- 
onwealth  of  Australia  for  1909,  page  540,  would  indicate  that  there 
as  been  a  material  industrial  growth  in  Victoria  from  1903  to  1907 : 


h 


AVERAGE   NUMBER   OF   PERSONS    EMPLOYED   IN    VICTORIA   MANUFACTURING    INDUSTRIES. 

1903 73,229  1907 90,903 

Increase,  24.10  per  cent. 


68  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

VALUE   OF   PLANT   AND    MACHINERY   IN    FACTORIES. 

1903..— £5,010,896   ($24,302,846) 

1907 ....  £6,771,458   ($32,841,572) 

Increase,  35.09  per  cent. 

The  total  value  of  the  output  of  factories  in  Victoria  for  1907,  accord- 
ing to  the  same  authority,  page  552,  was  £29,693,634  ($144,014,125). 

DOES  THE  LAW  ENCOURAGE  IMPORTS  RATHER  THAN  LOCAL  MANUFACTORIES  ? 

Imports  have  largely  increased  due  (a)  to  the  high  degree  of  pros- 
perity enjoyed  in  recent  years  leading  to  a  consequent  increased  demand 
for  luxuries  and  grades  of  finer  and  more  fashionable  goods,  especially 
in  wearing  apparel,  than  the  State  produces;  and  (&)  to  the  scarcity  of 
skilled  labor,  more  especially  female  labor,  thus  preventing  many  manu- 
facturers from  increasing  their  capacity  to  keep  pace  with  the  increasing 
demand.  This  point  is  emphasized  by  the  Chief  Factory  Inspector,  who 
in  his  report  for  1907  says : 

STATE  OF  TRADE. 

(Chief  Factory   Inspector's   Report   for    1907.) 

The  only  complaints  made  by  manufacturers  were  on  account  of  the  scarcity  of 
labor.  This  was  more  particularly  the  case  in  trades  in  which  female  labor  pre- 
dominates, and  every  effort  was  made  to  increase  the  supply,  but'  without  success. 
The  manufacturers  found  it  simply  impossible  to  get  sufficient  labor.  Many  of 
them  informed  me  that  they  had  advertised  day  after  day  in  the  newspapers  for  girls 
to  learn  the  trade  without  receiving  a  single  reply.  One  clothing  manufacturer 
offered  to  pay  double  the  legal  wage  to  apprentices  without  success,  though  he  was 
prepared  to  pay  a  skilled  worker  to  devote  all  her  time  to  teaching  the  apprentices. 

The  industrial  growth  is  illustrated  by  the  Chief  Factory  Inspector 's 
report  of  1907,  which  reads  as  follows : 

STATE  OF  TRADE. 

(Chief  Factory  Inspector's  Report  for  December,  1907.) 
3,739  factories  employing  45,178  persons  were  registered  in  1897. 
5,003  factories  employing  71,968  persons  were  registered  in  1907. 

EFFECT  OF  WAGES  BOARDS  SYSTEM  ON  RURAL  DISTRICTS. 

The  higher  city  wages  militates,  as  a  rule,  against  rural  manufacturers 
retaining  their  best  labor.  In  good  times  it  also  militates  against  the 
farmer  holding  his  farm  laborers  in  the  face  of  city  competition,  in  the 
way  of  higher  wages,  but  the  condition  is  in  nowise  any  more  serious  in 
the  rural  districts  of  Victoria,  than  in  other  countries  where  no  wages 
boards  exist. 

WAGES  BOARDS — HOW  THEY  ARE  BROUGHT  INTO  EXISTENCE. 

Chief  Factory  Inspector  Ord  in  his  report  for  1907  tells  in  the  follow- 
ing manner  how  wages  boards  in  Victoria  are  brought  into  existence : 

MODE  OF  CONSTITUTING  SPECIAL  BOARDS   AND  OF  APPOINTING   MEMBERS. 
(Chief  Inspector  of  Factories'  Report  for  1907,  pp.  10-12,  Appendix  A.) 
I  have  been  so  constantly  asked  how  boards  are  brought  into  existence,  the  mem- 
bers  appointed,   and  determinations  reviewed,   that   I   think   it  desirable   to  shortly 


69 

scribe  the  whole  procedure.     It  is  necessary  to  remember  that  the  constitution  of 
a  board  and  the  appointment  of  members  of  a  board  involve  two  distinct  procedures. 
Before  a  special  board  is  constituted,  it  is  necessary  that  a  resolution  in  favor 
of  such   a   course   should   be   carried   in   both   houses   of   the   legislature.      (Section 
2,  Act  1975. ) 

It  is  usual  for  the  minister  administrating  the  factories  act  should  move  that  such 
a  resolution  be  passed. 

The  minister  may  be  induced  to  adopt  such  a  course,  either  by  representations 
made  by  employers  and  employees,  or  by  employees  alone,  or  by  the  report  of  the 
officers  of  the  department. 

The  reasons  alleged  by  the  employers  for  desiring  a  board  are,  usually,  unfair 
competition  ;  and  those  by  the  employees,  low  wages,  and  often  the  employment  of 
excessive  juvenile  labor.  If  the  minister  is  satisfied  that  a  case  has  been  made  out, 
he  will  move  the  necessary  resolution  in  Parliament,  and  when  such  resolution  has 
been  carried,  an  order  in  council  is  passed  constituting  the  board. 

The  order  indicates  the  number  of  members  to  sit  on  the  board.  The  number 
of  members  must  not  be  less  than  four  or  more  than  ten.  (Section  75,  Act  1975.) 
The  minister  then  invites  in  the  daily  press,  nominates  for  the  requisite  number 
of  representatives  of  employers  and  employees.  These  representatives  must  be  or 
must  have  been  employers  or  employees,  as  the  case  may  be,  actually  engaged  in  the 
trade  to  be  affected.  All  that  is  necessary  is,  that  the  full  names  and  addresses  of 
persons  willing  to  act  should  be  sent  in. 

Where  there  are  associations  of  employers  or  of  employees,  it  is  not  often  that 
more  than  the  number  of  nominations  are  sent  in.  In  any  case,  the  minister  selects 
from  the  persons  whose  names  are  received  the  necessary  number  to  make  up  the 
full  board. 

The  names  of  persons  so  nominated  by  the  minister  are  published  in  the  Govern- 
ment Gazette,  and  unless  within  twenty-one  days  one  fifth  of  the  employers  or  one 
fifth  of  the  employees,  as  the  case  may  be,  forward  a  notice  in  writing  that  they 
object  to  such  nominations,  the  persons  so  nominated  are  appointed  members  of  the 
board  by  the  governor  in  council.  ( Section  3,  Act  1975. ) 

If  one  fifth  of  the  employers  or  the  employees  object  to  the  persons  nominated 
by  the  minister,  and  they  must  object  to  all  the  nominations,  and  not  to  individuals, 
an  election  is  held  under  regulation  made  in  accordance  with  the  act.  (Section 
77  (3),  1975.) 

Shortly  stated  employers  may  have  from  one  to  four  votes  according  to  the  size 
of  the  factories  as  regards  the  election  of  employers,  but  as  regards  a  special 
board  for  shops,  each  employer  has  only  one  vote,  and  each  employee  in  the  trade 
over  eighteen  years  of  age  has  a  vote  in  the  election  of  representatives  of  employees. 
The  chief  inspector  conducts  such  elections,  the  ballot  being  by  post,  the  ballot 
papers  being  forwarded  to  each  elector. 

Within  a  few  days  of  their  appointment  the  members  are  invited  to  meet  in  a 
room  at  the  office  of  the  chief  inspector  of  factories,  and  a  person,  always  a  govern- 
ment officer,  and  usually  an  officer  of  the  chief  inspector's  department,  is  appointed 
to  act  as  secretary. 

The  members  must  elect  a  chairman  within  fourteen  days  of  the  date  of  their 
appointment,  and  if  they  can  not  agree  to  a  chairman  he  is  appointed  by  the 
governor  in  council.  (Section  82  (1),  1975.) 

The  times  of  the  meeting,  the  mode  of  carrying  on  the  business,  and  all  pro- 
cedure is  in  the  future  entirely  in  the  hands  of  the  board,  whose  powers  are  defined 
in  sections  84-90,  Act  1975,  and  sections  15  and  16  of  Act  2137. 

Vacancies  in  special  boards  are  filled  on  the  nomination  of  the  minister  without 
any  possibility  of  either  employer  or  employee  objecting  (section  181,  1975).  And 
the  same  course  is  observed  regarding  all  appointments  of  members  of  the  furniture 
board.  (Section  78,  Act  1975.) 

The  result  of  the  labors  of  a  board  is  called  a  "determination,"  and  each  item  of 
such  determination  must  be  carried  by  a  majority  of  the  board. 

It  will  be  seen  that,  unless  employers  and  employees  agree,  a  full  attendance  of 


70  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

the  board  is  required,  as,  in  case  of  a  difference  of  opinion,  the  chairman  decides  the 
matter,  and  he  has  only  one  vote,  the  same  as  any  other  member  of  the  board. 

When  a  determination  has  been  finally  made,  it  must  be  signed  by  the  chairman, 
and  forwarded  to  the  Minister  of  Labor.  The  board  fixes  a  date  on  which  the 
determination  should  come  into  force,  but  this  date  can  not  be  within  thirty  days  of 
its  signature  by  the  chairman. 

If  the  minister  is  satisfied  that  the  determination  is  in  form  and  can  be  enforced, 
it  is  duly  gazetted.  (Section  101  (1),  1975.) 

In  the  event  of  the  minister  considering  that  any  determination  may  cause 
injury  to  the  trade,  or  injustice  in  any  way  whatever,  he  may  suspend  same  for  any 
period,  not  exceeding  six  months,  and  the  board  is  then  required  to  reconsider  the 
determination. 

If  the  board  does  not  make  any  alteration,  and  is  satisfied  that  the  fears  are 
groundless,  the  suspension  may  be  removed  by  notice  in  the  Government  Gazette. 
(Section  105,  1975.) 

This  power  is  not,  however,  likely  to  be  used  by  the  minister,  as  proceeding  is 
now  made  under  part  X  of  Act  No.  1907,  by  which  either  employers  or  employees 
may  appeal  to  the  court  of  industrial  appeals  against  any  determination  of  a  board. 

This  court  consists  of  any  one  of  the  judges  of  the  supreme  court  sitting  alone, 
and  the  judges  arrange  which  of  them  shall  for  the  time  being  constitute  the  court. 

An  appeal  may  be  lodged  (a)  by  a  majority  of  the  employers'  representatives  on 
a  special  board;  (6)  the  majority  of  the  employees'  representatives  on  the  special 
board;  (c)  any  employer  or  group  of  employers  who  employ  not  less  than  twenty- 
five  per  cent  of  the  total  number  of  workers  in  the  trade  to  be  affected ;  or, 
(d)  twenty-five  per  cent  of  the  workers  in  any  trade. 

The  court  has  all  the  power  of  a  special  board,  and  may  alter  or  amend  the 
determination  in  any  way  it  sees  fit. 

The  decision  of  the  court  is  final,  and  can  not  be  altered  by  the  board,  except 
with  permission  of  the  court,  but  the  court  may,  at  any  time,  review  its  own  decision. 

The  minister  has  power  to  refer  any  determination  of  a  board  to  the  court,  for 
its  consideration,  if  he  thinks  fit,  without  appeal  by  either  employer  or  employee. 

The  decision  of  the  court  is  gazetted  in  the  same  way  as  the  determination  of  the 
board,  and  comes  into  force  at  any  date  the  court  may  fix. 

The  determinations  of  the  board  and  of  the  court  are  enforced  by  the  factories 
and  shop  department,  and  severe  penalties  are  provided  for  breaches  of  determina- 
tion. (Section  119,  Act  1975.) 

No  proceedings  for  breaches  of  the  determination  can  be  taken  by  any  one  without 
the  sanction  of  the  department. 

Any  employee,  however,  may  sue  an  employer  for  wages  due  him  under  any 
determination,  notwithstanding  any  contract  or  agreement  expressed  or  implied  to 
the  contrary.  (Section  114  of  Act  1975.) 

HOW  WAGES  BOARDS  ARE  REGARDED. 

It  can  not  but  be  of  interest  to  know  how  the  wages  boards  and  their 
operations  are  regarded  by  Victorian  employers,  wage-earners  and  gov- 
ernment officials.  Accordingly,  I  give  herewith  an  extract  taken  from 
a  paper  by  W.  N.  Pratt,  Esq.,  read  before  the  Conference  of  Australian 
Employers'  Federation  and  published  in  its  report  for  1905,  pages  85 
to  93,  which  I  feel  fairly  represents  the  consensus  of  opinion  among  the 
Victorian  employers : 

The  one  original  reason  for  the  formation  of  the  wages  boards  was  to  prevent 
sweating.  Mr.  Harrison  Ord,  Chief  Factories  Inspector,  says :  "The  board  was 
created  to  prevent  sweating"  (1898,  page  6).  I  can  find  no  other  real  reason,  and 
the  method  by  which  this  has  to  be  done  is  set  out  in  the  act  itself.  Clause  14, 
Act  1857,  passed  in  1903.  says  :  "The  board  shall  ascertain  the  average  prices  or 


VICTORIA,  AUSTRALIA. 


71 


rates  paid  by  reputable  employers  to  employees  of  average  capacity.  The  lowest 
prices  or  rates  as  fixed  by  any  determination  shall  in  110  case  exceed  the  average 
prices  or  rates  so  ascertained." 

While  denying  that  sweating  existed  to  any  great  extent  in  the  majority  of  trades, 
we  are  obliged  to  admit  that  in  a  few,  such  as  clothing,  white  work  and  where  females 
were  very  largely  employed,  sweating  did  exist,  and  to  a  considerable  extent.  A  few 
disreputable  employers  had  forced  the  hands  of  their  more  humane  comrades,  and 
by  a  constant  cutting  of  prices,  had  sent  wages  down  to  a  very  low  level.  Individual 
cases  of  sweating  among  old,  slow  and  infirm  workers  could  also  be  pointed  out. 
But  it  is  quite  certain  that  sweating  did  not  exist  among  the  strong,  young  and 
active  workers ;  they  are  well  able  to  look  after  themselves,  and  did  so,  commanding 
the  highest  wages  and  most  constant  employment  at  all  times,  as  will  always  be 
the  case.  The  act,  then,  was  only  needed  for  the  protection  of  the  old,  slow  and 
infirm  workers,  and  for  women  and  children,  to  save  them  from  the  evils  of 
sweating. 

Have  the  boards  then  accomplished  the  purpose  for  which  they  were  established? 

1.  Have   they   put   down   sweating  in   the   clothing   trade?     Yes,   and   largely   in 
trades  where  women  are  employed.     But  in  many  other  trades  they  have  increased 
it,  for  the  slow,  old  men  have  been  driven  to  work  at  home  for  very  low  rates ; 
while  the  female  outworkers  have  been  nearly  swept  away  and  the  male  outworkers 
in  some  trades  have  been  largely  increased. 

2.  Have  they  protected  those  who  needed  protection?     In  the  case  of  females  they 
have  to  a  large  extent.     In  the  case  of  old,  infirm  and  slow,  they  have  failed  to 
protect,  though  the  permit  system  now  in  force  will  possibly  effect  this  to  a  certain 
extent. 

3.  Have   they   increased  employment?     No !      AVhatever   increase   of  employment 
has   taken   place   has   been   through   the   natural   expansion   of   trade,   an   expansion 
similar  to  that  which  took  place  between  1885  and  1SS9,  when  an  increase  of  some 
8,000  hands  took  place. 

4.  Have  they   raised  wages?     I  .think  we  must  say  yes,  as  far  as  the  average 
per  man  is  concerned,  but  not  the  extent  that  the  bald  figures  show ;   the  general 
improvement  in  trade  is  answerable  for  a  deal  of  the  rise,  and  the  different  circum- 
stances of  the  two  classes  of  trades — those  under,  and  those  not  under  the  boards — 
must  be  considered. 

I  may  be  permitted  to  point  out  where  I  consider  them  (wages  boards)  preferable 
to  an  arbitration  court : 

1.  They  are  more  mobile,  having  simpler  constitution  and  methods.     The  board 
is  easily  convened,  its  sittings  and  decisions  are  free  from  red  tape,  and  it  attends 
only  to  the  business  of  its  own  trade,  directly  its  business  is  over  its  sittings  stop, 
and  all  expenses  cease. 

2.  The  members  of  the  board  are  all  experts  in  their  own  trade.     All  intricate 
questions  and  technicalities  are  easily  understood,  mistakes  and  delays  are  avoided, 
free  avenues  of  trade  easily  and  quickly  provided  for. 

3.  The  powers  of  the  boards  are  limited  and  defined.     They  deal  only  with  the 
rates    of   wages,   hours   to   be   worked,   overtime    and   improvers.      All   questions    of 
custom  or  privilege  are  outside  its  powers.    These  fruitful  causes  of  dispute  and  delay 
in  the  arbitration  court  are  happily  excluded  from  the  boards. 

4.  Their  decisions  are  more  satisfactory.     In   a  large  number  of  instances  they 
are  unanimous,  and  are  accepted  by  the  whole  trade  without  demur. 

The  following  extract,  taken  from  a  circular  issued  by  the  executive 
committee  of  the  Melbourne  Trades  Council,  gives  the  consensus  of 
opinion  of  the  Victorian  wage-earners  on  the  value  of  the  wages  boards : 

They  (the  executive  committee)  are  of  the  opinion  that  arbitration  courts  and 
wages  boards  have  not  failed  to  give  protection  and  relief  to  the  sweated  and  other 
workers,  but,  on  the  contrary,  they  have  afforded  very  material  and  financial  help, 
and  created  conditions  that  would  not  have  existed  otherwise. 


72  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

And  finally,  I  quote  herewith  from  the  Australian  Yearbook,  page 
1072,  to  give  the  official  opinion  of  the  value  of  the  Victorian  wages 


EFFECT  OF  ACTS. 

The  question  whether  the  operation  of  the  acts  has  bettered  the  monetary  position 
of  the  operative  may  be  answered  in  the  affirmative.  Starting  from  the  lowest  point, 
the  provision  of  an  absolute  minimum  wage  per  week  has  stopped  one  form  of 
gross  sweating.  Another  case  is  that  of  the  "white  workers''  and  dressmakers  ;  with 
these  the  lowest  form  were  the  outworkers,  who  were  "pieceworkers."  In  some 
branches  of  the  Victorian  trade  in  1897,  wages  paid  to  outworkers  for  all  classes 
of  certain  goods  were  only  from  one  third  to  one  half  the  wages  paid  in  the  factories 
for  the  low  class  of  productions  of  the  same  line  of  stuff.  By  working  very  long 
hours  the  outworker  could  earn  ten  shillings  (about  $2.40)  a  week.  The  average 
wage  of  females  in  the  clothing  trade  in  1897  was  ten  shillings  tenpence  (about 
$2.60)  per  week.  There  were,  however,  in  that  year  4,164  females  receiving  less 
than  a  pound  (about  $4.85)  a  week,  and  their  average  was  eight  shillings  and 
eightpence  (about  $2.08).  It  was  almost  a  revolution  when  a  minimum  wage  of 
sixteen  shillings  (about  $3.84)  per  week  of  forty  -eight  hours  was  fixed  by  the 
board  ;  when  piecework  rates  were  fixed  to  insure  a  similar  minimum,  and  when 
the  outworkers  were  placed  on  the  level  of  pieceworkers.  Many  employers  refused 
to  give  outwork  and  took  the  workers  into  the  factory  on  time  work.  The  sanitary 
conditions  required  were  far  more  healthy  than  those  that  could  exist  in  poorer 
classes  of  dwellings. 

CONCLUSION. 

Have  the  Victorian  wages  boards  been  a  success  and  have  they  accom- 
plished the  end  in  view  at  the  time  of  their  enactment  —  that  of  abolish- 
ing sweating  and  establishing  industrial  peace  ? 

No  impartial  investigator  who  is  seeking  facts,  pure  and  simple,  can 
render  any  verdict  other  than  that  the  Victorian  wages  boards  have 
to  use  a  colloquialism,  more  than  '  '  made  good.  '  ' 

They  were  enacted  primarily  to  prevent  sweating  in  the  industries 
where  wromen  and  children  are  largely  employed. 

The  consensus  of  opinion  of  all  interested  parties  is  that  wages  boards 
have  so  largely  minimized  sweating  that  it  is  no  longer  an  evil  in  Vic- 
toria, where  the  '  '  sweater  '  '  has  become  a  somewhat  rare  species. 

The  wages  boards  have  not  alone  reduced  the  evil  of  sweating  to  a 
minimum,  but  they  have  achieved  other  most  desirable  and  important 
results  not  exactly  anticipated  at  the  time  of  the  enactment  of  the  law. 
The  authors  of  the  measure  seemingly  builded  better  than  they  knew. 

The  wiping  out  of  the  "sweater"  has  been  a  great  blessing  to  the 
fair  employer,  who  is  no  longer  compelled  to  compete  with  an  unfair 
rival  who,  by  "squeezing"  helpless  labor,  is  in  a  position  to  undersell 
or  underbid  him. 

Every  Victorian  manufacturer  starts  out  on  an  even  basis,  so  far 
as  payment  to  labor  is  concerned.  To  secure  the  largest  share  of  pos- 
sible business,  he  must  exercise  his  managerial  ability  along  other  lines 
than  that  of  "squeezing"  labor.  The  legal  minimum  wage  tends  to 
drive  the  "sweater"  out  of  the  field.  Where  no  legal  minimum  wage 


VICTORIA,  AUSTRALIA.  73 

exists,  the  ''sweater"  tends  to  drive  the  fair  manufacturer  out  of  the 
field. 

The  wages  boards  have  brought  about  another  unexpected  blessing 
to  Victorian  employers,  wage-workers,  and  to  the  body  politic.  They 
have,  for  a  period  of  over  twelve  years,  aided  in^  if  not  maintained,  an 
unprecedented  era  of  industrial  peace.  The  fact  that  the  State  had 
provided  machinery  where  wage-earners,  having  wage  grievances,  could 
get  a  fair  hearing  and  a  fair  deal  at  the  hands  of  the  trade  experts  rep- 
resenting both  sides  of  the  issue,  and  the  fact  that  the  determinations 
are  enforceable  against  employers,  left  little  occasion  to  resort  to  strikes 
in  order  to  secure  what  they  deemed  equity. 

In  consequence  Victoria,  considering  the  numbers  industrially  en- 
gaged, has  enjoyed  the  highest  degree  of  industrial  peace  that  in  the 
past  decade  or  more  has  been  vouchsafed  to  any  other  country  in  any 
occidental  government.  It  must,  therefore,  be  evident  that  if  industrial 
peace  is  the  test,  Victoria  has  come  more  nearly  discovering  the  missing 
link  between  capital  and  labor  than  has  any  other  modern  industrial 
land. 


74  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 


NEW  SOUTH  WALES,  AUSTRALIA. 


The  State  of  New  South  Wales  is  an  empire  in  itself,  covering  an 
area  of  198,635,000  acres  or  310,372  square  miles,  with  less  than  five  per- 
sons to  the  square  mile,  embracing  some  of  the  most  fertile  soil  in 
Australia. 

It  is  much  the  wealthiest  State  in  the  commonwealth,  and  stands  first 
in  Australian  agriculture  and  industrial  production,  and  in  its  volume 
of  imports  and  exports;  and  with  a  population  of  about  1,500,000,  its 
wealth  and  purchasing  power  per  capita  ranks  second  only  to  that  of 
New  Zealand. 

In  common  with  Victoria  it  has  an  ideal  climate  and  a  splendid  health 
record,  less  than  ten  deaths  per  thousand  per  annum. 

A  high  degree  of  prosperity  has  been  enjoyed  by  New  South  Wales, 
and  there  is  little  of  what  in  the  older  countries  is  known  as  poverty. 
There  are  no  poor  rates  and  no  workhouses  in  New  South  Wales. 

It  is  claimed  by  the  Intelligence  Department  of  New  South  Wales  that 
its  citizens  are  the  most  lightly  taxed  people  in  the  world,  with,  so  to 
speak,  no  direct  taxation,  the  profit  on  the  government  business  under- 
takings practically  paying  the  whole  of  its  annual  interest  bill. 

The  wage-earner  living  in  this  State,  therefore,  starts  out  with  many 
advantages.  In  addition  to  these  favorable  conditions,  few  governments 
elsewhere  have  given  greater  attention  to  the  amelioration  of  the  con- 
dition of  the  wage-earner,  more  especially  to  the  unorganized  and  the 
weaker  industrial  workers,  than  has  the  government  of  New  South 
Wales. 

The  State  has  no  race  problems  to  deal  with,  as  nearly  the  whole  popu- 
lation— ninety-seven  and  one  half  per  cent — is  of  British  extraction. 

WAGES. 

In  common  with  the  rest  of  the  world,  wages  during  the  era  of  pros- 
perity have  tended  upward.  This  has  been  due  partly  to  a  protective 
tariff,  policy,  partly  to  the  policy  of  the  Labor  party,  which  has  been  to 
restrict  immigration  in  order  to  cause  scarcity  of  labor  and  consequent 
higher  wages,  and  partly  in  the  sweated  and  unorganized  industries,  to 
the  awards  of  wages  boards  and  arbitration  courts. 

From  data  furnished  by  State  Registrar  Addison,  I  find  that  in  forty- 
eight  occupations,  dealt  with  by  the  legal  authorities,  wages  have, 


NEW  SOUTH  WALES,  AUSTRALIA.  75 

through  their  awards,  increased  16.21  per  cent.    These  occupations  have 
been  chiefly  in  the  sweated  industries. 

The  average  wage  per  day  for  unskilled  workers  is  seven  shillings  to 
seven  shillings  and  six  pence  ($1.68  to  $1.80)  and  for  skilled  workers 
ten  shillings  to  eleven  shillings  and  six  pence  ($2.40  to  $2.76). 

COST   OF   LIVING. 

The  cost  of  living  has  increased,  due  largely  to  the  advance  in  the 
world  price  of  the  great  agricultural  staples  and  also  to  the  enhanced 
value  of  city  lots — carrying  with  it  a  consequent  increase  in  rent.  It  is 
claimed  that  the  increase  in  wages  has  also  added  to  the  increased  cost 
of  living.  This,  however,  is  true  only  in  a  minor  degree.  In  manufac- 
turing industries  higher  wages  have  been  more  or  less  offset  by  the  intro- 
duction of  greater  labor  saving  machinery. 

The  Australian  protective  tariff  has  also  tended  in  more  recent  years 
to  add  somewhat  to  the  cost  of  living. 

HOURS    OF   LABOR. 

The  hours  of  labor  in  the  building  and  generality  of  trades  are  eight 
per  day.  Since  the  enactment  of  labor  legislation,  the  hours  in  sixteen 
occupations  have  been  reduced  from  an  average  of  seventy  per  week  to 
an  average  of  fifty-six  and  one  half  per  week. 

These  sixteen  occupations  include  such  as  drivers  of  bakery  and  milk 
wagons,  hotel  and  restaurant  employees,  ferry  employees,  brewery 
hands,  shore  drivers,  and  firemen. 

Among  these,  for  example,  were  such  extreme  cases  as  drivers  of 
bakery  wagons,  whose  weekly  hours  were  reduced  from  seventy-six  to 
sixty ;  ferry  emploj'ees  whose  hours  per  week  were  reduced  from  eighty 
to  sixty,  and  shore  drivers  and  firemen,  whose  weekly  labor  was  cut 
down  from  eighty-four  hours  to  forty-eight. 

RELATIONS   BETWEEN   EMPLOYERS   AND   THEIR    MEN. 

Opinions  conflict  on  this  point.  Many  employers  state  that  the  rela- 
tions are  strained  and  unfriendly,  wrhile  labor  leaders  express  the  view 
that  relations  are  cordial  and  harmonious.  My  own  opinion  is  that  the 
relations  between  employers  and  their  employees  are  far  more  friendly 
and  cordial  than  they  are  on  the  continent  of  Europe  and  in  some  parts 
of  the  United  States,  and  more  cordial  than  those  in  England  except  in 
the  branches  of  English  industries  where  disputes  are  settled  by  volun- 
tary conciliation  and  arbitration. 

LABOR   UNIONISM. 

The  effect  of  labor  legislation  in  New  South  Wales,  according  to 
Attorney  General  Hughes,  was  to  increase  union  membership  from 
seventy-five  to  one  hundred  per  cent.  The  report  of  the  Government 


76  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

Statistician  for  1907  shows  that  there  were  registered  in  that  year  136 
labor  unions,  with  membership  of  92,230. 

It  is  explained  that  these  figures  do  not  represent  the  position  of 
unionism,  since  all  unions  do  not  register,  and  that  particulars  of  unreg- 
istered unions  are  not  available. 

STRIKES. 

There  are  no  official  records  kept  of  strikes  in  New  South  Wales.  The 
following  record  was  furnished  me  by  Registrar  Addison  from  his 
private  files.  The  total  number  of  strikes  since  1901  was  as  follows : 

1901 . 2  1906 29 

1902 12  1907 52 

1903.. 11  1908  (first  3  months) 33 

1904 11 

'1905 36  186 

Fully  half  of  these  strikes  occurred  among  men  engaged  in  mining. 

Out  of  the  foregoing  number  there  were  the  following  instances  where 
employees  struck  after  having  obtained,  and  during  the  existence  of  an 
award  of  the  court  of  arbitration  in  an  industrial  dispute  to  which  they 
were  parties,  and  as  a  refusal  to  obey  an  award : 

1904 J . 2 

1905 1 

1906 1 

1907 8 

1908 1 

13 

One  of  these  instances  was  in  the  case  of  wire  netting  workers ;  one  in 
the  case  of  sawmillers ;  five  of  wharf  laborers,  and  coal  lumpers,  and  the 
remaining  six  cases  were  miners. 

EMPLOYERS'  ORGANIZATIONS. 

Employers  in  New  South  Wales  are  but  little  organized,  and  in  the 
nature  of  things  here  can  not  seem  to  achieve  effective  organization. 

STATE  PROVISION  FOR  CONCILIATION  AND  ARBITRATION. 

After  the  great  maritime  strike  of  1891  a  Royal  Commission  was 
appointed,  who  recommended  that  a  court  of  conciliation  and  arbitra- 
tion be  created,  voluntary  in  character.  Parliament  accordingly  created 
the  desired  legal  machinery.  The  law,  however,  proved  a  dead  letter. 
In  1895  a  legislation  of  compulsory  inquiry  was  established.  Under  this 
law  an  inquiry  was  held  in  the  Victory  mine  trouble.  The  mine  owners, 
however,  refused  to  abide  by  the  decision  and  the  men  were  helpless. 

In  1901  compulsory  arbitration  came  into  effect,  modeled  after  the 
New  Zealand  law,  with  the  penalty  of  imprisonment  for  violation  of  the 
law,  but  the  arbitration  court  soon  became  so  congested  that  the  act 


NEW   SOUTH  WALES,   AUSTRALIA.  77 

broke  down.  This  led  to  a  marked  change  in  the  law  brought  into  effect 
at  the  expiration  of  the  Compulsory  Arbitration  Act  in  1908.  A  new 
scheme  was  devised  in  the  nature  of  a  combination  of  the  wages  board 
system  of  Victoria  with  the  compulsory  arbitration  system  of  New 
Zealand,  that  will  be  referred  to  more  in  detail  later  in  this  report. 

COMPULSORY  ARBITRATION. 

As  mentioned  in  the  preceding  paragraph,  a  compulsory  arbitration 
law  modeled  after  the  New'  Zealand  law  went  into  effect  in  1901  for  a 
limited  period  of  six  years.  The  act  seemingly  did  not  work  out  as  its 
authors  had  hoped.  It  led  to  intense  feeling,  more  especially  on  the  part 
of  employers,  whose  sentiments  after  the  act  had  been  in  operation  for 
about  four  years  are  expressed  in  the  following  extract  from  a  paper 
read  by  C.  H.  Austin,  Esq.,  on  the  New  South  Wales  Compulsory  Arbi- 
tration Act  of  1901.  before  an  Employers'  Federation  meeting  held  in 
1905: 

With  such  an  example  as  that  afforded  by  New  Zealand  before  us,  it  would  seem 
folly  to  expect  any  more  beneficial  results  to  follow  the  introduction  of  the  com- 
pulsory arbitration  system  in  New  South  Wales.  Nor  when  we  look  at  the  facts  do 
we  find  that  its  workings  there  have  been  productive  of  such  good  as  to  justify  its 
existence.  By  the  Act  the  power  of  arbitration  in  industrial  matters  is  vested  in  a 
court  composed  of  a  supreme  court  judge,  as  president,  and  two  members  nominated 
one  each  by  the  industrial  unions  of  the  employers  and  employees,  respectively,  the 
three  appointed  by  the  governor  in  council.  I  should  like  to  say  at  the  outset  that 
although  I  intend  to  hold  up  to  view  the  workings  of  the  Act  in  all  its  naked  ugliness, 
it  is  not  my  wish  to  reflect  in  the  slightest  degree  upon  any  member  of  the  court. 
The  court  was  called  upon  to  interpret  an  Act,  illogical  in  its  conception,  cumber- 
some, unworkable,  and  mischievious  in  its  workings  and  results.  Mortal  men  in 
my  opinion  could  not  have  done  better  than  they  have  done.  For  the  Act  itself  I 
have  the  greatest  abhorrence  ;  for  the  president  and  members  of  the  court  I  have  the 
greatest  respect.  The  court  is  given  power,  among  other  things,  to  deal  with  the 
following  "industrial  matters"  : 

(a)  The  wages,  allowances,  or  remuneration  of  any  person  employed  or  to  be 
employed  in  any  industry,  or  the  prices  paid  or  to  be  paid  therein  in  respect  of  such 
employment. 

(6)  The  hours  of  employment,  sex,  age,  qualifications,  or  status  of  employees,  and 
the  mode,  terms  and  conditions  of  employment. 

(c)  The  employment  of  children,  or  young  persons,  or  any  person  or  persons  or 
class  of  persons  in  any  industry,  or  the  dismissal  or  refusal  to  employ  any  particular 
person  or  persons  or  class  of  persons. 

(rf)  Any  established  custom  or  usage  of  any  industry,  either  generally  or  in  any 
particular  locality ;  and 

(e)   The  interpretation  of  an  industrial  agreement. 

We  have  the  extraordinary  spectacle  of  the  highest  legal  authority  in  the  state 
(Chief  Justice  Dooley),  with  the  concurrence  of  his  colleagues,  roundly  condemning 
the  Act  in  the  following  terms  : 

"It  is  also  beyond  a  question  that  the  arbitration  Act,  as  in  force  in  this  state,  is 
an  Act  which  is  in  derogation  of  the  common  law ;  it  does  encroach  upon  the  liberty 
of  the  subject  as  regards  person  and  property  ;  it  creates  new  crimes  unknown  to 
the  common  law  or  contained  in  any  previous  statute.  It  interferes  with  the  liberty 
of  action  of  both  employers  and  employees.  It  precludes  the  one  from  giving  and  the 
other  from  obtaining  employment  except  upon  terms  imposed  by  the  Act.  It  deprives 
the  employer  from  the  conduct  of  his  own  business,  and  vests  it  in  a  tribunal  formed 


78  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

under  the  Act,  and  it  can  prescribe  terms  of  management  which,  however  injurious 
they  may  be  to  the  employer,  he  must  comply  with,  under  penalties  for  any  breach 
of  the  order  of  the  court  There  are  many  matters  to  which  I  might  refer,  such  as 
the  operation  of  the  common  rule  upon  persons  who  have  not  been  before  the  court, 
but  it  is  not  necessary  to  do  so. 

"Further,  I  think  this  Act  is  productive  of  the  most  alarming  and  deplorable  amount 
of  litigation  with  its  concomitant  ill  feeling  and  ill  will  between  employer  and 
employee  who  are  by  this  Act  forced  into  hostile  camps.  I  believe  the  object  of  the 
legislature  in  passing  this  Act  was  to  promote  peace  and  good  will  between  employers 
and  employees,  but  I  fear  it  has  not  done  so." 

Against  the  pronounced  wishes  of  the  Labor  party,  which  was  most 
anxious  to  have  the  compulsory  arbitration  measure  renewed  and  made 
a  permanent  act,  the  law  was  abondoned.  In  this  connection  it  can  not 
but  be  of  interest  to  note  the  attitude  in  this  action  of  ex- Attorney 
General  Wise  of  New  South  "Wales,  under  wrhose  direction  and  general- 
ship the  Compulsory  Arbitration  Act  of  1901  was  placed  on  the  statute 
book.  The  following  is  his  statement : 

The  object  of  the  Compulsory  Arbitration  Act  was  to  make  bargaining  collective ; 
therefore,  under  the  Act,  trade  unionism  was  made  the  industrial  unit.  For  this 
purpose,  unions  were  given  power  under  the  Act  to  make  contracts  and  sue  members 
for  fees  and  the  court  was  give  power  to  grant  preferences  to  unionists  in  the  giving 
of  employment,  provided  the  union  limited  its  right  to  strike,  and  its  rules  were 
approved  by  the  registrar  so  that  it  might  not  become  a  close  corporation.  This 
implied  that  only  the  union  could  set  the  Act  in  motion  on  behalf  of  the  men. 

The  Act  further  provides  that  industrial  agreements  made  between  employers  and 
men  and  approved  by  the  court  should  be  enforceable  so  that  penalties  could  be 
recovered  for  a  breach.  The  award  to  hold  for  two  years. 

More  than  two  thirds  of  the  industries  of  the  state,  including  thirty  different 
trades  employing  150,000  men,  were  working  under  industrial  agreements. 

In  June,  1905,  the  high  court  held  that  industrial  agreements  could  not  become  a 
common  rule ;  that  is,  could  not  be  made  to  apply  to  the  trade  generally.  The  Act 
was  not  amended  to  cover  this  weak  spot  and  the  most  useful  part  of  the  measure 
went  by  the  board. 

A  further  result  was  that  the  industries  which  had  been  regulated  by  agreements 
now  rushed  to  the  court,  causing  great  congestion  and  final  breakdown  of  the  tribunal. 

Several  other  decisions  were  given  which  hampered  the  operations  of  the  court 
without  the  necessary  amendments  being  made  to  the  law.  Whereas  in  New  Zealand 
the  Act  was  amended  seven  times  in  the  first  five  years  of  its  existence. 

EFFECTS   OF   THE   ACT. 

For  the  first  five  years  there  were  no  strikes.  There  were  a  few  spasmodic  out- 
bursts in  later  years,  owing  to  the  impossibilities  of  getting  cases  heard.  The  case 
of  the  New  Castle  unions,  for  example,  was  in  court  four  years  before  a  hearing  was 
obtained,  and  even  then  a  special  tribunal  had  to  be  appointed.  Even  in  the  three 
or  four  actual  strikes,  all  in  coal  mines  or  maritime  trade,  no  support  was  given 
the  other  unions.  The  system  killed  sympathetic  strikes. 

By  establishing  a  minimum  wage  it  abolished  sweating,  and  it  strengthened 
unionism  by  establishing  a  preference  for  unionists  in  about  half  the  awards. 

The  congestion  of  business,  the  overloading  of  the  arbitration  court  with  motions 
for  penalties  which  should  have  been  heard  by  magistrates  or  by  the  registrar,  caused 
a  final  breakdown  of  the  judicial  machinery,  the  hostile  administration  in  power 
rendering  no  assistance  due  to  its  policy  to  destroy  the  Act. 

The  Act,  however,  established  the  principle  that  the  public  has  the  same  interest  in 
checking  industrial  disputes  as  in  preventing  street  brawls.  The  proof  of  this  is 


NEW  SOUTH  WALES,  AUSTRALIA.  79 

that  even  the  opposing  political  party  on  getting  into  power  adopted  all  the  essential 
principles  of  the  Act,  and  which  are  now  in  force,  simply  changing  the  method. 

I  never  contended  that  the  Act  would  absolutely  prevent  strikes,  its  purpose  being 
to  prevent  strikes  and  lockouts,  and  to  compel  both  parties  to  operate,  if  they  do 
operate,  in  accordance  with  the  award.  But  there  was  nothing  in  the  law  to  compel 
men  to  work  or  employers  to  keep  their  shops  open  if  the  award  was  not  satisfactory 
to  them. 

Ex-Attorney  General  Hughes  in  this  connection  said : 

The  old  New  South  Wales  compulsory  arbitration  law  made  distinctly  for  indus- 
trial peace.  It  prevented  any  serious  industrial  outbreaks  during  years  of  great 
prosperity  when  labor  was  well  organized.  Under  ordinary  conditions  there  would 
have  been  conflict. 

Chief  Secretary  Wood  said : 

Compulsory  arbitration  meant  congestion  and  delay  by  appeals,  and  it  had  a 
tendency  to  widen  differences  and  cause  an  increased  unfriendly  feeling  between 
master  and  men. 

The  possible  point  of  failure  in  compulsory  arbitration  is  the  inability  to  enforce 
decisions  against  a  large  body  of  men. 

Registrar  Addison  in  this  connection  said : 

As  proof  that  the  compulsory  arbitration  law  did  not,  and  does  not,  contemplate 
the  enforcement  of  its  decisions,  the  record  is  cited  that  between  June,  1904,  and 
June,  1908,  there  were  thirteen  cases  where  men  struck  work  after  the  court  award, 
refusing  to  obey  the  awards.  In  only  one  instance  were  the  men  brought  into  court — 
that  was  in  Rhonda,  Northumberland  and  Northern  extended  mines — and  the  decision 
on  a  technicality  was  in  their  favor,  on  the  ground  that  their  agreement  with  their 
employers  did  not  stipulate  that  notice  to  quit  work  must  be  given.  The  award,  it 
was  claimed,  simply  established  the  point  that  if  they  returned  to  work  they  must 
do  so  on  the  terms  of  the  award.  Nothing  in  the  award  could  prevent  them  from 
exacting  better  terms  if,  having  a  monopoly  of  labor,  they  could  do  so. 

Prime  Minister  Wade,  on  being  invited  to  express  his  opinion  on  the 
recent  Arbitration  Act,  said: 

The  Compulsory  Arbitration  Act  resulted  in  congestion  of  cases.  The  long  wait 
of  one  and  two  years  for  decisions  led  to  labor  unrest,  resulting  in  numerous  strikes. 
Under  the  compulsory  arbitration  law  cases  were  manufactured  because  of  the 
desire  to  take  advantage  of  the  ignorance  of  the  assessors. 

Preference,  as  a  rule,  being  given  under  the  awards  to  unionists,  union  member- 
ship was  increased  and  used  for  political  purposes. 

Prompt  action  in  labor  disputes  is  most  important.  But  under  compulsory  arbi- 
tration law,  there  were  two  possible  appeals  from  the  judgment  of  the  industrial 
court,  first  to  the  full  court,  and  then  to  the  high  court. 

To  convict  for  violation  of  an  award  meant  a  jury  trial  with  but  rare  instances 
of  conviction.  Under  our  new  Act  there  is  no  delay.  The  board  consists  of  experts 
and  appeals  are  cut  out  by  confining  finality  to  the  industrial  court,  which  has  power 
to  act  summarily. 

The  crown  initiates  the  prosecutions  for  violations  of  the  wages  boards  awards. 

Judge  Heydon,  president  of  the  industrial  court,  said : 

The  real  objection  to  the  old  compulsory  arbitration  court  was  the  fact  that  the 
court  was  congested.  Provisions  against  strikes  were  severe  but  ineffective.  The 
strike  in  the  New  Castle  coal  mine  showed  the  law  to  be  useless.  The  tendency  of 
the  arbitration  court  was  to  raise  wages.  The  court  was  a  boon,  as  are  the  present 
wages  boards,  to  the  "sweated"  workers. 


80  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

In  this  connection  I  am  prompted  to  quote  the  following  extracts 
from  a  letter  written  by  Judge  Heydon  in  October,  1907,  to  Henniker 
Heaton,  Esq.,  M.  P. : 

There  is  a  good  deal  of  confusion  of  thought  in  the  public  mind  as  to  the  objects 
to  be  obtained  by  the  introduction  of  compulsory  arbitration  in  industrial  matters. 
*  *  *  Properly  speaking,  however,  the  objects  aimed  at  are  (1)  the  prevention 
of  sweating,  and  (2)  the  prevention  or  limitation  of  strikes  and  lockouts. 

Of  these  the  former  is  of  much  easier  attainment,  and  is  free  from  most  of  the 
difficulties  with  which  the  second  is  beset.  The  sweated  classes  are,  as  a  rule,  the 
weak  classes,  who  can  do  little  or  nothing  for  themselves.  In  their  case  the  tribunal 
becomes  one  exercising  protective  function,  and  the  statute  creating  it  and  clothing 
it  with  the  necessary  powers  is  related  to  the  measure  by  which  the  conditions  in 
factories,  the  labor  of  women  and  children,  and  the  closing  time  of  shops  is  regulated. 
Taken  altogether,  they  amount  to  no  more  than  the  imposition  on  the  competing 
industrial  capitalists  of  conditions  subject  to  which  their  competition  is  to  be  car- 
ried on,  conditions  intended  to  protect  the  weak,  and  in  the  interest  of  society  and 
humanity  to  prevent  them  from  being  ground  down  in  the  cruel  mills  of  intense  com- 
petition. An  industrial  arbitration  act  going  only  so  far  as  this  can  hardly  be 
called  by  any  one  a  socialistic  measure.  If  it  is,  then  the  other  legislation  to  which 
I  have  referred  is  also  socialistic.  It  no  more  discourages  individualism  and  prevents 
competition  than  did  the  law  that  prevents  the  competitor  from  killing  his  rival.  It 
permits  competition  and  encourages  individualism  by  giving  to  the  competent  enter- 
prising employer  the  ful!  reward  of  his  industry,  but,  in  the  interests  of  the  com- 
munity, it  lays  down  certain  laws  subject  to  which  competition  must  be  carried  on. 

I  think  that  it  can  be  said  with  considerable  confidence  that  in  this  aspect  of  its 
operation  industrial  arbitration  has,  in  Australia  and  New  Zealand,  come  to  stay, 
and  will  remain  a  permanent  feature  of  our  social  life.  The  employment  of  men 
and  women  under  cruel  condition  and  for  grossly  insufficient  wages  is  most  repug- 
nant to  public  sentiment.  We  are  united  in  a  strong  desire  to  prevent  it,  and  nearly 
every  one  is  reconciled  to  the  idea  of  preventing  it  by  means  of  a  tribunal  whose 
decisions  shall  be  binding. 

The  second  object  of  compulsory  industrial  arbitration  is  much  more  difficult  of 
attainment  To  forbid  strikes,  and  compel  industrial  disputants  to  come  to  a  court, 
and  to  clothe  that  court  with  power  to  regulate,  by  a  compulsory  decree,  the  conditions 
that  prevail  in  every  industry  in  which  the  parties  are  unable  to  agree  of  themselves, 
is  to  intrude  into  a  totally  different  sphere.  If  there  are  weak  classes  likely  to  be 
imposed  upon,  and  in  the  ordinary  sense  of  the  term,  sweated,  and  to  whom  it  is  in 
the  highest  degree  just  that  a  fair  living  wage  should  be  awarded,  there  are  also 
strong  unions  able,  without  the  assistance  of  any  tribunal,  to  win  for  themselves 
terms  which  rise  as  far  above  a  fair  living  wage  as  those  of  the  sweated  classes  fall 
below  it.  To  take  away  from  those  men  the  weapon  of  the  strike,  and  to  impose  upon 
them  the  compulsion  of  a  peaceful  award  is  to  enter  at  once  upon  difficulties  of  the 
gravest  character.  They  consider  that  they  have  (as  indeed  they  clearly  have)  the 
right  to  the  best  wages  they  can  get,  and  any  court  which  imposes  on  them  a  wage 
which  in  their  opinion  is  smaller  than  that  appears  in  their  eyes,  unless  they  have 
the  fullest  confidence  in  its  personnel,  is  an  unjust  tyrant. 

In  the  humanitarian  function  of  the  court,  first  mentioned  above,  it  is  evident 
that  there  can  be  no  question  of  compelling  the  worker ;  he  is  only  too  glad  to  get 
from  the  justice  of  the  community  the  relief  which  he  can  not  win  for  himself. 
Compulsion,  therefore,  must  bear  upon  the  employers,  but  a  man  has  really  no  more 
right  to  carry  on  business  by  paying  a  sweating  wage  than  by  paying  no  wage  at  all. 
Other  employers  usually  welcome  the  introduction  of  a  uniform  rule,  which  enables 
them  to  pay  a  fair  wage  by  compelling  their  competitors  to  pay  it. 

A  battle  royal  took  place  in  the  New  South  Wales  legislative  assembly 
when  a  new  bill  was  brought  in  by  Premier  Wade  in  March,  1908,  pro- 


NEW  SOUTH  WALES,  AUSTRALIA.  81 

viding  for  wages  boards  supplemented  by  an  industrial  court,  in  lieu  of 
a  compulsory  arbitration  court,  which  had  ceased  to  exist  by  the  termi- 
nation of  the  act  created  for  six  years  in  1901. 

The  Labor  party  fought  against  overwhelming  odds  to  retain  com- 
pulsory arbitration  with  its  preference  to  labor  unionists  and  its  limita- 
tion of  apprentices,  but  was  finally  defeated.  I  quote  the  following 
from  the  speeches  delivered  on  that  occasion  by  Premier  Wade,  which 
give  a  most  interesting  and  comprehensive  resume  of  the  points  of 
failure  of  the  old  act  and  the  essential  features  of  the  new  measure. 

ARBITRATION   COURTS. 

INDUSTRIAL   DISPUTES    BILL. 
(Extract  from  speeches  by  Premier  Wade.) 

Page  2  :  We  have  taken  as  far  as  we  can  the  legislation  of  adjoining  states  and 
countries,  and  from  our  experience  of  the  past,  introduced  elements  which  may  tend 
to  make  more  perfect  the  purposes  which  we  have  in  view. 

Pages  3-4 :  In  the  first  place  the  compulsory  arbitration  court,  in  their  anxiety 
to  be  seized  of  all  the  history  of  the  particular  trade  before  them,  spend  a  largi- 
amount  of  time  in  being  initiated  and  taught  the  element!,  the  A  B  C  of  the  trade. 
With  these  two  preliminary  difficulties — first  of  all,  the  want  of  knowledge  on  the 
part  of  the  court  leading  to  the  loss  of  time  in  the  educating  of  themselves  in  regard 
to  the  trade,  and  the  further  loss  of  time  involved  by  putting  forward  claims  of  an 
extravagant  and  baseless  nature,  there  has  been  an  enormous  amount  of  time  con- 
sumed in  an  unprofitable  and  expensive  manner. 

Page  0  :  The  inexperience  of  the  court,  the  extravagance  of  the  claims  made,  and 
the  presence  of  the  legal  fraternity  led  to  an  immense  prolongation  of  nearly  every 
case  that  came  before  the  court.  The  result  was  necessarily  an  increase  in  expense. 
which  became  very  heavy  in  some  cases.  We  find  that  during  the  first  twelve 
months  of  the  life  of  this  court  it  dealt  with  only  eleven  disputes,  which  were  all 
prolonged  and  some  to  a  very  great  length.  But  at  the  end  of  a  year  there  was  a 
list  of  something  like  seventy  cases  which  had  accumulated  and  were  waiting  determi- 
nation by  the  court. 

Page  6 :  The  court  was,  I  might  say.  rushed  with  claims  from  industries  of  all 
descriptions  advancing  grounds  for  redress  at  the  hands  of  the  court.  I  have  actually 
heard  it  stated  on  the  part  of  more  than  one  industry  that  their  real  purpose  was 
to  secure  preference  by  the  court,  that  their  condition  of  life  was  not  so  bad  after 
all.  When  the  unions  saw  that  whether  they  achieved  success  or  not  in  the  way  of 
an  increase  of  wages,  they,  at  all  events,  had  the  opportunity  of  having  the  prefer- 
ence clause  granted  them  by  the  court,  there  was  naturally  a  rush  by  all  the  industries 
that  could  do  so  to  come  before  the  court,  and  if  possible  obtain  that  result.  *  *  * 
Under  these  circumstances,  by  a  particularly  simple  method,  which  \Vas  not  for  a 
moment  contemplated  by  those  who  formed  the  act,  the  opportunity  was  given  the 
labor  unions  to  strengthen  their  political  organization  with  the  disastrous  results 
to  the  arbitration  court  as  an  industrial  tribunal  of  congesting  its  work  in  a  most 
deplorable  way.  The  very  first  we  ask  for  in  any  useful  tribunal  is  a  ready  access 
to  that  body  in  the  case  of  trouble.  It  is  no  use  to  be  told,  "Lay  down  the  weapons 
of  a  strike ;  stop  your  lockout ;  when  trouble  arises,  go  before  this  tribunal  of  peace, 
which  will  deal  with  your  case  promptly  and  without  delay."  What  is  the  good  of 
that  cry,  what  is  the  use  of  the  remedy,  when  you  find  in  the  case  of  trouble  that 
those  unions  which  have  a  real  substantial  grievance  can  not  expect  redress  unless 
they  wait  for  one,  or,  possibly,  two  or  more  years?  It  is  hardly  to  be  wondered  at 
under  these  conditions  that  there  might  be  a  union  with  a  real  substantial  grievance 
which  could  not  approach  the  court,  and  in  despair  took  the  alternative  of  trying 
to  redress  things  in  its  own  way. 

6 


82  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

WAGES    BOARDS. 

Page  20:  The  main  points  we  make  for  this  proposed  wages  boards  bill,  as  I  say. 
are  expedition,  simplicity,  finality  and  determination  by  a  body  of  experts. 

Page  27 :  A  separate  tribunal  is  appointed  by  the  bill  to  carry  out  the  other 
necessary  conditions  of  the  statute  which  is  to  enforce  those  awards  and  to  punish 
for  breaches  of  them.  And  it  is  obvious  that  when  you  have  boards,  all  of  which 
consist  of  lay  members  without  legal  experience,  and  the  necessity  of  many  of  them 
having  as  their  chairman  a  layman  also  it  would  be  unwise  to  provide  that  that 
same  body,  possibly  of  laymen,  too,  should  have  the  power  of  enforcing  awards, 
inflicting  penalties,  and  possibly  imprisoning  persons  convicted  before  them ;  and 
there  is  the  further  anomaly  that  when  you  have  a  board,  or,  what  might  be  called 
a  bench,  composed  of  employees  and  employers,  it  would  lead  to  endless  friction 
and  disastrous  results  if  it  were  possible  for  the  employees  to  send  their  employers 
to  goal  by  their  award,  or  if  the  employers  sent  to  goal  their  employees  who  might 
possibly  have  been  working  in  harmony  with  them  on  the  same  board  a  short  time 
before,  so  it  became  essential  to  make  this  broad  dividing  line :  to  have  the  making 
of  the  trade  conditions  in  the  hands  of  the  boards,  and  to  have  some  other  tribunal 
as  a  body  to  enforce  these  awards  when  made. 

"CLOSED  SHOP/' 

The  law  goes  no  further  than  to  say  that  it  shall  not  be  obligatory 
to  grant  any  preference  in  its  awards  to  members  of  unions.  It  leaves 
the  point  to  be  determined  between  the  parties.  In  consequence,  there 
are  some  unions,  notably  in  the  hat  industry,  that  refuse  to  allow  their 
members  to  work  with  nonunionists  in  the  same  industry.  These,  how- 
ever, are  exceptional  cases.  As  a  rule,  union  and  nonunion  men  work 
side  by  side. 

EFFECT  OF  STATE  INTERVENTION  ON  CAPITAL  IN  INDUSTRIAL  ENTERPRISES. 

The  opponents  of  State  intervention  in  labor  disputes  maintain  that 
such  intervention  has  made  for  the  driving  out  of  capital  and  the  dis- 
couragement of  industrial  undertakings. 

A  recent  writer  on  this  point  says:  "While  some  capital  may  have 
been  frightened  away  because  of  state  labor  legislation,  such  legisla- 
tion has  actually  given  a  feeling  of  security  and  permanency  to  industry 
consequent  on  its  having  rendered  serious  strikes  improbable.  As  these 
facts  become  more  generally  known,  it  will  be  conducive  to  inviting  the 
investment  of  foreign  capital. ' ' 

The  following  facts  taken  from  the  latest  government  report,  1909,  do 
not  substantiate  the  charge  that  State  intervention  in  labor  disputes 
affects  industrial  growth  unfavorably : 

Manufactories  1903  . 3,476 

Manufactories  1907  4,387 


Increase 911 — 26.20  per  cent. 

Hands  employed  1903 66,269 

Hands  employed  1907 .  87,194 


Increase 20,925—31.57  per  cent. 


NEW  SOUTH  WALES,  AUSTRALIA.  83 

WAGES   BOARDS. 

The  act  adopted  in  April,  1908,  in  lieu  of  the  compulsory  arbitration 
act  of  1901,  which  had  expired  by  limitation,  bears  the  title  of  "Indus- 
trial Disputes  Act  of  1908." 

Briefly,  it  includes  a  schedule  of  about  eighty  industries,  and  pro- 
vides that  on  application  of  employer  or  employers  of  not  less  than 
twenty  employees,  or  a  trade  union  registered  under  the  act  having  a 
membership  of  no  less  than  twenty  employees,  or,  in  the  absence  of 
an  existing  trade  union,  twenty  employees  of  an  industry,  the  industrial 
court  may  recommend  to  the  minister  that  a  board  be  constituted  for 
such  industry.  Or,  without  any  application,  the  minister  on  recom- 
mendation of  the  industrial  court  may  direct  a  board  to  be  constituted. 

Each  board  consists  of  a  chairman  and  not  less  than  two  nor  more 
than  four  other  members,  one  half  employers  and  the  other  half  em- 
ployees who  are  or  have  been  engaged  in  the  industry. 

The  appointment  of  the  members  is  made  by  the  governor  on  the 
recommendation  of  the  industrial  court,  which,  as  a  rule,  accepts  the 
nominees  of  both  parties,  or  in  the  event  of  the  parties  failing  to  nomi- 
nate, makes  its  own  recommendation  to  the  governor. 

Where  the  parties  agree  on  a  chairman,  such  party  is  nominated  by 
the  court.  Failing  to  agree,  the  governor  appoints  a  supreme  or  dis- 
trict court  judge,  or  some  person  nominated  by  the  court.  The  chair- 
man, in  his  discretion,  may  appoint  two  or  more  assessors  representing 
both  sides  to  advise  on  technical  points,  but  without  voice  on  the  board. 
Members  of  the  board  and  assessors  are  sworn  to  secrecy  on  penalty  not 
to  divulge  any  evidence  relating  to  trade  secrets;  the  profits  or  losses 
or  the  receipts  and  outgoings  of  any  employer ;  the  contents  of  books  of 
an  employer  or  witness  produced ;  the  financial  position  of  any  employer 
or  witness.  The  members  of  the  board  hold  office  for  two  years.  The 
governor  fixes  the  fees  paid  board  members  and  assessors. 

Proceedings  are  commenced  before  a  board,  by  reference  to  the  board 
by  the  industrial  court,  or,  by  application,  to  the  board  by  employers  or 
employees.    The  board  has  the  power  to- 
rt. Decide  all  disputes ; 

Z>.  Fix  the  lowest  p*rices  for  piecework  and  the  lowest  rate  of  wages 
payable  to  employees ; 

c.  Fix  the  number  of  hours  and  the  times  to  be  worked  in  order  to 
entitle  employees  to  the  wages  so  fixed; 

d.  Fix  the  lowest  rates  for  overtime  and  holidays,  and  other  special 
fork; 

e.  Fix  the  number  or  proportionate  number  of  apprentices,  and  the 
lowest  prices  and  rates  payable  to  them; 


84  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

/.  Appoint  a  tribunal  for  the  granting  of  permits  allowing  aged, 
infirm  or  slow  workers  to  work  at  lower  than  regular  wages ; 
g.  Determine  any  industrial  matter; 
h.  Rescind  or  vary  any  of  its  awards. 

The  decisions  of  the  board,  subject  to  an  appeal  to  the  industrial 
court,  are  binding  on  all  persons  engaged  in  the  industry  Avithin  the 
locality  specified  for  the  period  fixed  by  the  board,  not  less  than  for  one 
nor  greater  than  three  years.  The  board  may  conduct  its  proceedings 
in  public  or  in  private,  at  its  discretion.  It  may  exercise  in  respect  to 
witnesses  and  documents  and  persons  summoned,  giving  evidence  before 
it,  the  same  powers  conferred  on  a  committee  of  elections  and  qualifica- 
tions. An  employer's  books  may  be  called  for  only  in  the  event  of  his 
claim  that  the  profits  of  his  business  are  not  sufficient  to  enable  him  to 
pay  the  wages  or  grant  the  conditions  claimed. 

No  advocates  are  allowed  to  appear  before  the  board  without  the  con- 
sent of  the  chairman.  Decisions  of  the  board,  if  not  presided  over  by  a 
judge,  may  be  appealed  from  to  the  industrial  court  within  one  month 
by  any  trade  or  industrial  union,  or  by  any  person  bound  or  intended 
to  be  bound  by  the  award.  The  industrial  court  only  may  rescind  or 
vary  any  award  or  order  made  by  the  board.  It  may  also  cancel  or 
vary  any  recommendation  made. by  it.  An  employee  may  apply  to  the 
industrial  court  within  three  months  for  an  order  to  recover  from  the 
employer  the  full  amount  of  any  balance  due  for  wages  as  fixed  by  the 
board,  notwithstanding  any  smaller  payment  or  any  express  or  implied 
agreement  to  the  contrary.  Such  order  is  deemed  a  judgment  for  the 
amount. 

PROHIBITION  OF  LOCKOUTS   OR  STRIKES. 

If  any  person  does  any  act  or  thing  in  the  nature  of  a  lockout  or 
strike,  or  suspends  or  discontinues  employment  or  instigates  to  or  aids 
in  any  of  the  above  mentioned  acts,  he  is  liable  to  a  penalty  not  exceed- 
ing one  thousand  pounds  ($4,850)  or  in  default  to  imprisonment  not 
exceeding  two  months.  Nothing,  however,  prohibits  the  suspension  or 
discontinuance  of  any  industry  or  the  working  of  any  person  therein 
for  any  cause  not  constituting  a  lockout  or  strike.  Any  person  commit- 
ting a  breach  of  an  award  of  a  board  or  of  J:he  industrial  court  is 
liable  to  a  penalty  not  exceeding  fifty  pounds  ($242.50),  and  in  default 
of  payment  to  imprisonment  not  exceeding  three  months,  or  for  a  willful 
act  or  default  of  the  person  charged,  the  court  may  in  lieu  of  such  pen- 
alty imprison  for  not  exceeding  three  months. 

To  dismiss  an  employee  because  he  is  a  member  of  a  board  or  a  trade 
union,  or  for  any  other  reason,  having  in  view  the  evasion  of  an  award, 
lays  the  employer  liable  to  a  penalty  not  exceeding  twenty  pounds 
($97.00)  for  each  employee  so  dismissed.  In  every  case  it  lies  with  the 


NEW  SOUTH  WALES,  AUSTRALIA.  85 

employer  to  satisfy  the  judge  that  such  employee  was  dismissed  by 
reason  of  some  facts  other  than  those  mentioned.  Proceedings  for  any 
offense  against  the  provisions  of  the  act  are  taken  before  the  industrial 
court,  and  are  heard  and  determined  in  a  summary  manner. 

The  court  may  order  a  trade  union  to  pay  out  of  its  funds  any  amount 
not  exceeding  twenty  pounds  ($97.00)  of  the  penalty  imposed  upon  any 
of  its  members,,  unless  it  can  be  shown  by  the  union  that  it  exercised 
every  reasonable  effort  to  prevent  its  members  from  going  on  strike  or 
from  taking  part  in  a  strike  or  instigating  or  aiding  a  strike.  The 
decision  of  the  industrial  court  is  final. 

Employers  and  employees  must  give  at  least  twenty-one  days'  notice 
of  an  intended  change  affecting  conditions  of  employment  with  respect 
to  wages  or  hours. .  During  the  proceedings  before  a  board,  neither  party 
can  alter  the  conditions  of  employment  with  respect  to  wages  or  hours. 
' '  Statu  quo ' '  must  be  maintained.  The  foregoing,  in  substance,  are 
the  salient  points  of  the  law  enacted  in  April,  1908,  and  amended  in 
December,  1908,  and  known  as  the  "Industrial  Disputes  Act  of  1908." 
It  will  be  noted  from  the  foregoing  provisions  of  the  New  South  Wales 
industrial  dispute  act,  that  practically  it  is  the  Victorian  wages  board 
system  described  in  my  preceding  report,  combined  with  certain  fea- 
tures of  the  New  Zealand  compulsory  arbitration  act.  As  a  matter  of 
fact.  Premier  Wade,  the  framer  of  the  act,  stated  that  he  had  taken  as 
far  as  he  could  the  legislation  of  adjoining  states  and  countries  with 
the  view  of  making  the  act  more  perfect  for  the  purpose  in  view. 

At  this  writing  the  act  has  been  in  operation  less  than  a  year.  It  is, 
therefore,  altogether  too  early  to  determine  how  nearly  it  is  likely  to 
achieve  the  results  aimed  at  by  its  framers,  in  establishing  a  higher 
degree  of  industrial  peace  than  was  achieved  under  the  compulsory 
arbitration  law  of  1901. 

ATTITUDE  OP  LABOR  COUNCIL. 

The  Labor  Council  of  Sydney  received  the  act  in  the  most  unfriendly 
spirit.  It  was  hostile  to  the  measure  because  (a)  it  did  not  provide 
for  preference  in  employment  to  unionists ;  ( b )  it  did  not  limit  appren- 
ticeship ;  (c)  it  provided  that  any  twenty  nonunion  employees  could  col- 
lectively unite  in  asking  for  a  wages  board,  thus,  in  the  opinion  of  the 
Labor  Council,  making  against  unionism.  The  council  agreed  that  if 
nonunionists  could  secure  wages  boards  there  would  be  no  incentive  for 
men  to  join  unions,  when  without  a  union  they  could  get  the  desired 
awards.  Accordingly,  the  Labor  Council  passed  a  resolution  calling 
upon  the  unions  to  refrain  from  registering  under  the  act  with  the  view 
of  making  it  a  dead  letter  and  defeating  its  purpose. 

Unionists  soon  found,  however,  that  the  fears  of  the  Labor  Council 
were  groundless.  In  no  instance  thus  far  have  applications  for  wages 


86  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

boards  been  made  by  nonunionists  and  unionism  has  continued  to  grow. 
Union  members  soon  discovered  that  the  law  afforded  advantages  to 
labor  in  the  way  of  establishing  fair  working  conditions  and  the  pre- 
vention of  sweating  that  labor  could  not  afford  to  ignore,  so  that  despite 
the  condemnatory  resolution  of  its  own  council,  unions  have  steadily 
been  registering  under  the  act  and  making  the  fullest  use  of  the  legal 
machinery  provided  for  the  betterment  of  labor  conditions  and  the  settle- 
ment of  labor  disputes. 

The  official  record  on  April  7,  1909,  as  furnished  me  by  Premier 
Wade,  stood  as  follows : 

Number  of  labor  unions  registered  under  the  act  of  1908 59 

Number  of  applications  for  boards 62 

Number  of  boards  appointed 36 

Number  of  determinations  of  boards 18 

Number  of  boards  sitting 4 

Number  of  hearings  not  yet  begun 13 

Greatest  number  of  boards  sitting  at  one  time 12 

Since  leaving  Sydney  I  have  been  informed  that  the  Labor  Council 
has  rescinded  its  resolution  against  the  wages  board  act,  having  realized 
that  it  is  not  proving  disadvantageous  to  unionism.  On  the  contrary, 
the  unions  have  found  the  following  advantage  under  the  new  act, 
which  they  seem  to  value  highly  and  which  they  did  not  enjoy  under 
the  compulsory  arbitration  act. 

Under  the  old  act  unions  could  get  judgment  against  members  for 
unpaid  dues,  but  found  it  almost  impossible  to  collect  such  judgments. 
Under  the  new  act  unions  can  get  judgments  from  a  district  court,  with 
power  to  garnishee  or  attach  wages  or  levy  on  the  property  of  a  delin- 
quent member,  with  the  penalty  attached  of  imprisonment  in  default 
of  payment. 

Despite  the  fact  that  the  law  is  yet  in  its  infancy,  and  too  young  to 
pass  upon  it  any  definite  judgment,  evidences  would  indicate  that  it  is 
likely  to  prove  successful.  We  have  seen  that,  despite  the  hostile  atti- 
tude towards  it  in  the  beginning  on  the  part  of  the  Sydney  Labor  Coun- 
cil, unions  were  not  slow  to  avail  themselves  of  the  benefits  it  affords  and 
that  out  of  about  eighty  industries  scheduled  in  the  act  as  entitled  to 
wages  boards,  fifty-nine  unions  registered  under  the  act  in  the  first 
few  months  of  its  existence.  On  the  other  hand,  employers  have 
expressed  to  me  the  opinion  that  in  their  judgment  the  wages  boards 
system  is  making  for  industrial  peace,  and  that  it  is  a  far  better  system 
than  and  a  great  improvement  on  compulsory  arbitration,  pure  and 
simple,  since  it  prevents  congestion  of  cases  (Premier  Wade  stated  that 
thirty  cases  had  been  disposed  of  in  the  first' eight  months  of  the  act), 
brings  the  knowledge  of  experts  to  bear  on  disputes,  and  tends  to  bring 
employers  and  men  together,  making  for  the  wiping  out  of  prejudices 


NEW  SOUTH  WALES,  AUSTRALIA.  87 

and  the  creation  of  more  cordial  relations,  the  decisions  of  the  boards, 
as  a  rule,  having  been  generally  accepted. 

The  secretary  of  one  employers'  association  said  that  the  wages  boards 
are  bringing  about  a  higher  degree  of  industrial  peace,  and  the  secre- 
tary of  yet  another  employers'  association  made  the  statement  that  the 
members  of  his  association  were  quite  satisfied  with  the  New  South 
Wales  wages  boards  law,  since  they  did  not  provide  for  preference  to 
unionists. 

VIOLATION  OP  WAGES  BOARD  ACT. 

There  have  been  two  important  convictions  for  violating  the  provision 
against  strikes  and  lockouts  since  the  act  went  into  operation.  The  first 
was  against  the  Lithgow  Iron  Works,  who  were  convicted  and  fined  by 
the  industrial  court  on  March  13,  1909,  in  the  sum  of  $250  and  $55 
costs  for  a  lockout ;  and  the  second  case  was  that  of  the  union  of  rock- 
choppers,  the  secretary  of  which  unlawfully  instituted  a  strike  which  led 
a  number  of  men  in  the  employ  of  the  metropolitan  district  water  sup- 
ply and  sewerage  board  to  discontinue  their  work.  Prosecutions  were 
instituted  against  one  hundred  and  eighteen  members  of  the  union. 
The  cases  against  the  officers  of  the  union  charged  with  instigating  the 
strike  were  heard.  The  two  secretaries  and  the  executive  officer  were 
fined  $150  each  or  six  weeks'  imprisonment,  and  the  president  of  the 
union  was  fined  $200  in  default  of  two  months'  imprisonment. 

THE  MINIMUM  WAGE — DOES  IT   MAKE  FOR  THE  DEAD  LEVEL? 

Despite  the  fact  that  New  South  Wales  employers  welcome  the  wages 
boards  in  preference  to  compulsory  arbitration,  many  of  them  contend 
that  the  minimum  wage  which  it  establishes  tends  to  create  the  dead 
level  among  workmen  and  to  diminish  output  by  pulling  the  efficient 
worker,  by  virtue  of  his  wage  being  cut  to  the  minimum,  down  to  the 
level  of  the  less  efficient  worker. 

My  investigations  have  led  me  to  the  conclusion  that  where  employers 
stand  upon  the  letter  of  the  law  and  reduce  the  wages  of  the  more  effi- 
cient men  down  to  the  legal  minimum,  it  tends  toward  the  dead  level, 
and  makes  for  deadening  the  ambitions  of  such  workers. 

In  the  industries  where  unskilled  labor  is  employed,  due  to  the  f act- 
that  the  law  has  established  a  fairly  high  minimum  ($1.75  to  $1.87 
per  day)  which,  considering  the  greater  purchasing  power  of  money 
here,  is  fully  as  high  if  not  higher  than  the  average  wage  paid  unskilled 
labor  in  the  United  States,  the  minimum,  as  a  rule,  becomes  the  maxi- 
mum wage.  The  incentive  for  efficiency  largely  remains,  however,  even 
among  unskilled  workers,  due  to  the  desire  to  retain  employment, 
employers  naturally  giving  the  more  efficient  workers  a  preference. 

In  the  skilled  trades,  however,  I  found  that  few  intelligent  employ- 
ers stand  upon  the  letter  of  the  law  and  cut  the  wages  of  highly  efficient 
men  down  to  the  minimum. 


88 


REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 


At  my  request  Premier  Wade  had  compiled  from  the  factory  sched- 
ules on  file  with  the  Chief  Factory  Inspector,  the  figures  showing  the 
actual  wages  paid  in  registered  factories.  From  the  following  table  it 
will  be  seen  that  the  law  does  not  make  for  the  dead  level  and  that  aside 
from  foremen,  over  fifty-one  per  cent  of  adult  workers  receive  more  than 
the  minimum  wage  fixed  by  law,  showing  clearly  that  the  merit  system 
largely  prevails  and  that  employers  differentiate  between  their  workers, 
thus  offering  an  incentive  for  higher  efficiency  and  a  larger  output. 

PREMIER'S  OFFICE,  SYDNEY,  5th  June,  1909. 

DEAR  SIR:  I  have  endeavored  to  secure  the  information  you  asked  for  with  regard 
to  the  minimum  wage.  The  particulars,  however,  are  not  collected  in  that  detailed 
form  which  makes  deductions  allowable.  Only  a  rough  calculation  is  possible  under 
the  circumstances,  which  I  scarcely  like  to  put  forward  as  being  able  to  stand  the 
test  of  examination. 

The  information  so  far  is  collated  in  respect  of  adult  workers  only — that  is. 
foremen  are  excluded,  also  workers  under  twenty-one  years  of  age,  as  well  as  old. 
slow  workers  who  work  for  loss  than  the  minimum  wage.  However,  I  think  the 
information  is  so  far  reliable  as  to  prove  that  a  proportion  of  workers,  under  awards 
of  the  court,  do  receive  more  thnn  a  minimum  wage. 

I  forward  a  table  that  has  boon  prepared.     I  think  it  would  be  wise  to  take  it  as 
correct  on  general  lines  and  not  to  be  relied  on  in  detail  until  there  has  been  oppor- 
tunity of  going  into  the  question  more  thoroughly  and  at  greater  leisure. 
Yours  faithfully. 

(Signed.  I  C.    S.    WADE. 

COLONEL  H.  WEINSTOCK, 

Special  Labor  Commissioner  for  California. 

MINIMUM   WAGE ARBITRATION    COL'RT   AWARDS. 


Industries. 
Tanners          

Receiving 
minimum 
wage. 
113 

Receiving 
over 
minimum 
wage. 

350 

Not 
classi- 
fiable. 

28 

Proportion 
receiving 
above  mini- 
mum wage. 

75.6  per  cent. 

Brickmakers             -          

672 

139 

136 

17.1  per  cent. 

Sawmills 

330 

197 

118 

37.4  per  cent. 

Ironworkers'  assistants 

] 

Kngineers   (ironworks) 

I      729 

251 

99 

25.6  per  cent. 

Stovemakers        -    --     -  _-  . 

^'ire  netting  workers* 

.__            j 

Bakers     

652 

321 

189 

33.0  per  cent. 

Cold  storage  employees 

52 

14 

20 

18.4  per  cent. 

Tailoresses                  

187 

1,011 

9 

S4.4  per  cent. 

Boot  employees 

747 

495 

171 

39.8  per  cent. 

Pressers  (clothing) 

7<; 

33 

30.3  per  cent. 

Saddlers 

77 

80 

11 

51.0  per  cent. 

Furniture  makers 

99 

306 

36 

75.5  per  cent. 

Wire  mattress  workers 

11 

30 

17 

73.2  per  cent. 

Gas  employees 

47 

816 

154 

94.5  per  cent. 

Laundries 

353 

343 

23 

49.3  per  cent. 

Brushmakersf 

Total        

4.145 

4,386 

696 

51.4  per  cent. 

Total  of  minimum  and  over 

minimum  wage 

8,531 

*  All  on  piecework. 

y  Great  majority   on  piecework. 


NEW  SOUTH  WALES,  AUSTRALIA.  S!) 

CONCLUSION. 

The  experience  of  New  South  Wales  with  its  labor  legislation  is  of 
profound  interest  to  the  investigator  because  of  its  progressive  char- 
acter. While  it  is  yet  perhaps  in  an  experimental  stage,  it  has  made 
important  strides  along  the  line  of  achieving  the  results  aimed  at, 
namely,  the  abolition  of  sweating  and  the  maintenance  of  industrial 
peace. 

In  the  beginning,  it  created  legal  machinery  for  the  settlement  of 
labor  disputes  by  voluntary  conciliation  and  arbitration  and  in  common 
with  other  states  and  countries  found  it  inefficient.  It  then  went  to 
the  other  extreme  and  created  a  most  drastic  compulsory  arbitration 
law.  This,  also,  it  found  largely  ineffective,  due  to  inherent  defects  in 
the  law  that  tended  to  friction,  delay  and  great  difficulty  in  enforcing 
court  decisions.  Profiting  by  these  experiences  it  sought  a  happy 
medium  by  creating  wages  boards,  where  employers  and  employees  can 
be  brought  together  under  favorable  and  friendly  conditions  with  every 
incentive  to  come  to  a  voluntary  understanding  which  is  legalized  by  the 
court.  In  the  event  of  a  failure  to  do  this,  it  is  made  possible  to  reach 
a  conclusion  by  the  intervention  of  an  impartial  chairman,  which  con- 
clusion i.s  likewise  legalized  by  the  court,  which  under  the  law  is  given 
power  to  enforce  the  decision.  In  this  wise,  a  way  has  been  found  not 
only  to  minimize  the  evil  of  sweating,  but  also  to  reduce  possible  strikes 
and  lockouts  to  the  fewest  number.  The  record  of  the  first  eight  months 
of  the  operations  of  the  act  is  encouraging. 

The  awards  of  the  wages  boards  have  generally  been  accepted,  with 
few.  if  any,  appeals  to  the  court.  Violations  of  the  law  have  been 
promptly  and  summarily  dealt  with  by  the  court,  and  the  claims  and 
counterclaims  of  the  employers  and  employees  have  had  a  prompt  and 
expeditious  hearing. 

Doubtless  Aveak  spots  in  the  act  that  will  need  attention  will  show 
themselves  as  time  goes  on ;  but  with  the  present  favorable  attitude 
toward  the  measure  on  the  part  both  of  employers  and  wage-earners, 
no  difficulty  should  be  experienced  in  strengthening  such  weak  spots  in 
an  equitable  manner  with  justice  to  employers  and  men. 


90  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 


AUSTRALIA. 


Australia  is  primarily  an  agricultural  and  pastoral  country.  In 
1908  the  area  under  crop  was  9,355,052  acres.  The  estimated  value  of 
production  from  industries  in  1907  was  as  follows : 

Agriculture,  including  pastoral $469,218,000 

Manufactures 182,239,000 

It  will  be  seen  from  these  figures  that  agriculture  produces  more  than 
two  and  one  half  times  the  value  of  manufactures  in  Australia  and  is 
likely  to  continue  doing  so  for  an  indefinite  period.  The  sparseness  of 
its  population — about  1.37  persons  to  a  square  mile,  or  4.197.037  people 
in  a  country  with  an  area  of  2,974,581  square  miles,  making  it  substan- 
tially as  large  as  the  United  States — makes  it  hardly  possible  to  maintain 
manufactories  on  a  scale  successfully  to  compete  with  the  great  indus- 
trial countries  of  the  world.  In  1907,  manufactories  had  grown  suffi- 
ciently large,  however,  to  keep  busy  12,555  factories,  employing  248.841 
hands. 

STATE  EFFORTS  IN  BEHALF  OF  WAGE- WORKERS. 

For  the  past  thirty-five  years  the  Australian  governments  have  yivcn 
much  attention  to  the  condition  of  its  factories  workers,  the  first  fac- 
tories act  having  been  passed  in  1873.  Much  of  this  has  been  due  to  the 
efforts  of  trade  unions,  whose  history  in  Australia  dates  back  to  1859. 

In  this  connection  the  official  Yearbook  for  1909,  page  1048,  says : 

DEVELOPMENT  OF  TRADE  UNIONS  IN  AUSTRALIA. 

Each  state  in  the  commonwealth,  it  may  be  said,  has  enacted  with  more  or  less 
elaboration,  legislation  respecting  trades  unions  and  respecting  regulation  of  the  con- 
ditions of  industrial  life,  particularly  those  of  factory  employment ;  and  each  state, 
except  Tasmania,  has  regulated  the  hours  of  business  for  the  great  majority  of  shops. 
Some  of  the  states  have  also  established  machinery  for  the  regulation  of  wages,  as 
well  as  of  other  matters  connected  with  employment. 

At  the  present  time  there  is  an  obvious  tendency  to  adjust  such  matters  throughout 
Australia  on  uniform  lines.  The  industrial  conditions  of  any  state  in  the  common- 
wealth naturally  react  quickly  on  any  other  State.  This  is  one  of  the  consequences 
of  a  unified  tariff,  and  of  the  fact  that  the  general  economic  conditions  of  any  one 
part  of  the  commonwealth  must  necessarily  affect  any  other  part.  An  expression  of 
the  intimacy  of  these  economic  and  industrial  relations  of  different  parts  is  seen. 
for  example,  in  the  refusal  of  the  arbitration  court  in  New  South  Wales  to  fix  the 
wages  in  the  boot  trade  at  a  higher  rate  than  that  fixed  by  the  wages  board  in 
Victoria,  because  of  the  additional  burdens  that  such  a  rate  would  place  on  local 
manufacturers. 


AUSTRALIA.  91 

LABOR  IN  AUSTRALIAN  POLITICAL  LIFE. 

Speaking  of  the  part  played  in  the  political  life  in  Australia  by  labor 
unions,  the  same  authority  says,  pages  1051-2 : 

It  was  during  the  decade  1880-90  that  the  trades  unions  of  Australia  espoused 
direct  legislative  representation  and  advocated  state  interference  between  employer 
and  employee.  This  policy  has  been  called  "new  unionism."  A  resolution  affirming 
the  desirability  of  parliamentary  representation  of  labor  being  passed  at  the  congress 
of  1884,  a  number  of  members  representing  the  special  interests  of  the  wage-earners 
were  elected  to  the  legislatures  of  several  states,  but  the  unions  took  no  steps  to  obtain 
representation  by  men  chosen  from  among  their  own  ranks  until  after  the  great  labor 
trouble  of  1890-92.  In  that  time  serious  strikes  occurred  in  the  maritime,  shearing, 
and  mining  industries,  and  it  was  then  that  the  Labor  party  proper  was  formed, 
though  a  certain  amount  of  ameliorative  legislation  had  already  forced  its  way  into 
the  statute  books  of  the  states.  Since  1890  the  party  has  considerably  influenced 
Australian  politics.  In  the  year  1904  a  labor  government  occupied  the  commonwealth 
treasury,  and  again  in  December,  190S,  a  second  labor  government  took  office.  The 
second  Deakin  ministry  had  the  support  of  the  Labor  party.  In  South  Australia  the 
premier  is  a  direct  labor  representative.  In  Queensland  a  third  of  the  House  of 
Representatives  are  labor  members.  In  New  South  Wales  the  election  of  1907 
strengthened  the  party,  and  it  is  now  an  important  element  in 'Parliament.  Victoria 
and  West  Australia  have  also  elected  a  considerable  number  of  direct  labor  repre- 
sentatives. 

Under  the  heading  of  "Limitation  of  Hours"  the  Yearbook.  1909, 
says,  page  1056 : 

As  already  remarked,  the  adoption  of  the  eight-hour  system  for  adult  males  has 
generally  been  the  outcome  of  the  representations  made  by  the  trades  unions.  Except 
in  New  Zealand,  there  is  no  general  legislation  to  enforce  the  principle,  although  there 
is  now  a  general  recognition  of  it.  A  week  of  forty-eight  hours  is  the  usual  working 
week.  The  larger  unions,  however,  have  lately  moved  for  a  net  day  of  eight  hours 
with  Saturday  a  half-holiday,  no  loading  of  other  days  being  permitted  as  compensa- 
tion for  Saturday  afternoon.  Under  this  scheme  there  are  for  five  days  equal  divisions 
for  periods  of  work,  recreation  and  rest,  and  four  hours'  work  on  Saturdays,  making 
a  working  week  of  forty-four  hours.  In  the  majority  of  occupations  forty-eight  hours 
weekly  is  the  recognized  limit  of  work.  On  the  establishment  of  wages  boards  and 
arbitration  courts,  in  the  states  where  those  institutions  exist,  the  authorities  thus 
created  adopted  the  rule  as  a  part  of  their  determinations  and  awards  whenever  it 
was  reasonably  practicable.  In  some  technical  and  specialist  trades  a  lower  maximum 
has  been  fixed,  such  as,  for  example,  the  typesetting  machine  operators  in  Victoria, 
for  whom  the  maximum  has  been  fixed  by  the  wages  boards  at  forty-two  hours 
weekly.  Reasonable  provision  is  made  by  statute  or  award  for  work  performed 
outside  of  the  scheduled  hours.  Organizations  of  employees,  however,  oppose  over- 
time in  any  industry  until  all  the  operatives  in  that  industry  are  working  full  time. 

In  speaking  of  "Labor  Legislation,"  the  Yearbook,  1909.  says,  page 
1064: 

Two  systems,  based  on  different  principles,  exist  in  Australia  for  the  regulation  of 
wages  and  general  terms  of  contracts  of  employment.  A  "wages  board"  system 
exists  in  New  South  Wales.  Victoria,  Queensland,  and  South  Australia,  and  an 
arbitration  court  in  West  Australia.  In  New  South  Wales  industrial  arbitration 
act  of  1901-05  instituted  an  arbitration  court.  This  court  expired  on  the  13th  of 
June,  1908,  having  delivered  its  last  judgment  on  the  previous  day.  Wages  boards 
were  substituted  under  the  industrial  disputes  act  of  190S.  There  is  also  the 
arbitration  court  of  the  commonwealth  which  has  power,  however,  to  deal  only  with 
matters  extending  beyond  the  limits  of  a  single  state. 


92  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

In  1904  the  Commonwealth  Parliament  enacted  a  law  known  as  the 
"Commonwealth  Conciliation  and  Arbitration  Act,"  having  for  its  end 
a  system  of  compulsory  arbitration  for  all  interstate  labor  disputes, 
with  the  view  of  preventing  strikes  and  lockouts. 

The  provisions  of  the  act,  in  brief,  are  as  follows : 

The  court  has  jurisdiction  for  the  prevention  and  settlement  of  inter- 
state industrial  disputes,  with  power  to  conciliate  with  the  view  to 
amicable  agreement  between  the  parties,  failing  in  this,  to  make  an 
equitable  award. 

The  states  may  refer  industrial  disputes  to  the  court,  and  permit  the 
working's  of  the  court  and  state  industrial  authorities  to  aid  each  other. 

The  la^v  forbids  interstate  strikes  or  lockouts,  subject  to  a  penalty  of 
£1.000  ($4,850).  The  award  of  the  court  is  binding  on  all  parties  to  the 
industrial  dispute. 

Assessors,  one  each  representing  employers  and  employed,  may  be 
appointed  by  the  court  for  the  purpose  of  advising  it  in  relation  to 
the  dispute,  and  to  discharge  such  other  duties  as  the  court  may  direct. 
The  court  has  power  to  fix  maximum  penalties  for  any  breach  or  non- 
observance  of  an  award,  not  exceeding  £1,000  ($4,850)  in  the  case  of  an 
employer  or  an  organization,  £10  ($48.50)  in  the  case  of  an  individual 
member  of  an  association. 

Power  is  also  given  the  court  to  summon  before  it  parties  to  the  dis- 
pute and  witnesses  and  to  compel  the  production  before  it  of  books,  docu- 
ments and  things  for  the  purpose  of  reference  only  as  to  matters  that 
relate  to  the  dispute. 

The  court  may  prescribe  a  minimum  wage  and  appoint  a  tribunal 
which  shall  have  the  power  to  fix  a  lower  rate  in  the  case  of  workers  who 
are  unable  to  earn  the  prescribed  minimum  wage. 

It  may  direct  that  other  things  being  equal,  a  preference  be  given  to 
members  of  labor  unions. 

In  addition  to  the  monetary  penalty  imposed,  the  court  has  the  power 
to  deprive  those  failing  to  observe  an  award,  of  all  rights  and  privileges 
under  the  act,  and  to  any  official  position  in  any  organization  interested 
in  the  award,  and  all  existing  or  accruing  rights  to  any  payment  out  of 
the  funds  of  any  organization  interested  in  the  award. 

Fines,  fees,  levees  or  dues  payable  to  any  labor  union  by  any  member 
may  after  registration  be  sued  for  and  recovered  in  the  name  of  the 
organization  in  any  court  of  summary  jurisdiction. 

We  have  seen  that  the  various  Australian  states  have  their  separate 
labor  legislation.  The  commonwealth  industrial  court  being  empowered 
to  deal  only  with  eases  that  affect  more  than  any  one  state.  In  this  con- 
nection the  Yearbook  for  1909,  says: 


AUSTRALIA.  !'o 

THE    NEW    PROTECTION. 

The  wide  difference  between  the  developments  in  the  several  states  of  the  com- 
monwealth of  the  regulation  by  state  institutions  of  the  remuneration  and  conditions 
of  the  worker  has  given  rise  to  the  desire  on  the  part  of  the  common  won  1th  govern- 
ment to  secure  uniformity  throughout  Australia  by  any  suitable  and  constitutional 
action  on  the  part  of  the  commonwealth.  The  provisions  of  state  wages  laws  vary 
considerably.  In  New  South  Wales,  Victoria,  and  West  Australia  some  experience 
has  been  gained  of  their  working.  The  wages  board  system  is  new  in  South 
Australia  and  Queensland.  Tasmania  is  without  legislation.  The  desirability  of 
uniformity  has,  as  already  mentioned,  been  recognized  by  the  New  South  Wales 
arbitration  court,  which  refused  the  bootmakers'  union  an  award  which  would 
increase  the  wages  of  its  members  to  amounts  exceeding  those  paid  in  Victoria  in 
the  same  trade,  the  expressed  ground  of  the  refusal  being  that  New  South  Wales 
manufacturers  would  be  handicapped  by  the  payment  of  a  higher  rate  of  wage  than 
that  prevailing  in  Victoria.  This  attitude  can  not  be  made  effective  by  the  arbitra- 
tion court  of  the  commonwealth,  which  has  jurisdiction  only  over  industrial  disputes 
extending  beyond  the  limits  of  any  one  state. 

This  desire  on  the  part  of  the  government,  backed  as  it  is  by  the  labor 
unions,  is  being  strenuously  opposed  by  employers  and  by  the  advocates 
of  state  rights ;  the  former  because  on  principle  they  are  opposed  to  com- 
pulsory arbitration,  and  the  latter  because  they  fear  too  great  a  cen- 
tralization of  federal  power. 

The  Australian  federal  law  is  substantially  the  same  as  that  of  New 
Zealand.  The  cardinal  principle  in  both  laws  is  that  labor  loses  the 
right  to  strike  and  the  employer  loses  the  right  to  lockout,  and  that  the 
court  has  the  plenary  powers  to  summon  before  it  the  parties  likely  to 
cause  industrial  strife.  It  postulates  organization.  The  men  especially 
must  organize,  hence,  the  law  makes  for  unionism. 

The  commonwealth  arbitration  law  has  now  been  in  existence  for  about 
four  years  and  a  half.  The  only  strike  or  lockout  thus  far  calling  for 
federal  intervention  was  at  the  Broken  Hill  mines,  in  New  South  Wales, 
involving  over  4,000  men.  In  dealing  with  the  decision  in  this  case.  I 
quote  from  the  Melbourne  Herald  of  March  12,  1909 : 

ARBITRATION BROKEN    HIM,  DECISION. 

Iii  the  first  civil  court  to-day.  Mr.  Justice  Higgins,  president  of  the  Common- 
wealth Court  of  Arbitration  and  Conciliation,  delivered  his  judgment  in  the  case  of 
the  Amalgamated  Miners'  Association  of  Broken  Hill  (claimants)  against  The 
Broken  Hill  Proprietary  Company,  Ltd.  (respondents). 

The  judgment  constitutes  an  arbitration  award  under  the  conciliation  and  arbitra- 
tion act,  and  fixes  the  wages  and  hours  of  the  men  employed  by  the  Broken  Hill 
Proprietary  Company  at  Broken  Hill  and  Port  Pirie.  *  *  *  Tho  dispute  between 
the  company  and  the  men  commenced  when  the  directors  of  the  company,  on 
December  7th  last,  posted  a  notice  at  the  mine  stating  that  the  "present  rate  of 
wages,  less  the  bonus,"  would  remain  in  force  on  and  after  December  21st. 

The  men  at  once  accepted  this  notification  as  meaning  a  reduction  in  wages.  The 
directors  of  the  proprietary  company  asserted  that  the  wages  as  paid  on  October  31. 
1903,  under  an  award  by  the  New  South  Wales  arbitration  court  were  still  in  force, 
but  that  in  addition  a  percentage  increase  by.  way  of  bonus  was  paid  under  an 
agreement  made  in  1906,  and  which  expired  on  December  31st  last.  This  percentage 
increase,  which  placed  the  wages  on  the  same  scale  as  that  paid  by  the  principal 


94  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

companies  in  Broken  Hill  other  than  the  Broken  Hill  Proprietary  Company  was 
to  be  withdrawn,  as  from  December  31st,  leaving  the  old  wage  still  in  force.  *  *  * 
His  honor  said  that  the  dispute  was  between  a  union  or  association  registered  under 
the  act,  employed  in  the  mining  industry,  and  a  company  which  before  the  dispute 
•  employed  4,195  men  at  Broken  Hill  and  Port  Pirie,  mostly  members  of  the  associa- 
tion. A  dispute  arose  between  the  Broken  Hill  companies  and  the  union  in  1903. 
and  a  state  award  was  made  which  lasted  till  1905.  A  conference  took  place  in 
1906,  and  an  agreement  was  made  between  the  union  and  the  twelve  principal  com- 
panies, including  the  proprietary  company. 

According  to  the  view  of  Mr.  Justice  Cohen,  as  expressed  in  the  Newcastle  Wharf 
Laborers'  Union  against  Newcastle  and  Hunter  River  Steamboat  Co.,  Ltd.,  of  New 
South  Wales,  as  he  (Mr.  Justice  Higgins)  understood  it,  it  was  the  duty  of  the 
company,  if  it  objected  to  the  wages  of  1907-8,  to  continue  paying  the  wages  till  the 
arbitration  court  allowed  the  reduction  of  wages.  *  *  *  But  whether  this  was  the 
true  meaning  of  the  federal  act  or  not,  the  position  was  that  the  mine  and  all  its 
mills  and  works  were  closed  and  silent,  and  were  picketed  by  the  men  ;  that  the 
company  had  its  immense  plaut  and  machinery  lying  idle,  and  was  losing  heavily  ; 
that  employees,  over  4,000  in  number,  had  been  thrown  suddenly  out  of  work  and 
out  of  wages ;  that  this  huge  enterprise,  with  its  hundred  branches  and  trades  which 
had  been  feeding  so  many  other  dependent  industries,  had  suddenly  become  paralyzed  : 
that  the  shopkeepers,  the  shipping,  the  railways,  and  incidental  industries  were 
suffering ;  that  the  resources  of  many  families  were  severely  strained.  It  was  his  duty 
now  to  try  to  settle  the  dispute  in  the  interests  of  the  public. 

Then  followed  his  decision,  which  was  in  the  nature  of  a  victory  for 
the  men,  since  he  awarded  them  substantially  the  wages  for  which  they 
contended. 

The  minimum  wage  fixed  in  the  schedule  includes  8s.  7%d.  ($2.07)  per  day 
for  laborers  at  Broken  Hill  and  8s.  3d.  ($1.98)  at  Port  Pirie,  at  10s.  ($2.40) 
per  day  for  miners  on  wages. 

Forty-eight  hours  to  constitute  a  week's  work,  overtime  to  be  paid  at  time  and 
a  quarter,  and  to  include  all  work  on  the  seventh  day  of  any  week,  on  holidays  or 
in  excess  of  ordinary  shift  time. 

The  award  to  operate  till  December  31,  1910.  The  court  will  not  order  the 
company  to  continue  working.  The  higher  wages  for  1906-8  was  declared  to  be  an 
increase  and  not  a  bonus. 

"My  duty,"  said  Judge  Higgius,  "is  to  make  such  an  award  as  to  set  the  wheels 
of  this  mammoth  enterprise  going  again,  if  it  is  possible  for  me  to  do  so  with  just 
regard  to  the  human  lives  concerned." 

The  first  condition  in  the  settlement  of  this  industrial  dispute  as  to  wages  is  that 
at  the  very  least  a  living  wage  should  be  secured  to  these  employees.  The  definition 
of  a  living  wage  adopted  is  the  money  necessary  to  satisfy  "the  normal  needs  of  an 
average  employee  regarded  as  a  human  being  in  a  civilized  community." 

On  the  point  that  the  mine  could  not  be  conducted  profitably  at  the  higher  wage. 
Mr.  Justice  Higgins  said :  "If  a  man  can  not  maintain  his  enterprise  without  cutting 
down  the  wages  which  are  proper  to  be  paid  to  his  employees — at  all  events  the  wages 
that  are  essential  to  their  living — it  would  be  better  that  he  should  abandon  the 
enterprise. 

"Unless  great  multitudes  of  people  were  to  be  irretrievably  injured,  and  society 
was  to  be  perpetually  in  industrial  unrest,  it  was  necessary  to  keep  this  living  wage 
as  a  thing  sacred  and  beyond  the  reach  of  bargaining.  But  when  the  skilled  laborer 
has  once  been  secured  a  living  wage  he  has  attained  nearly  to  a  fair  contractual 
level  with  the  employer,  and,  with  caution,  bargaining  may  be  allowed  to  operate. 

"When  the  proprietary  company  asks  me  to  fix  wages  lower  than  are  proper  for 
the  industry  as  a  whole,  and  adduces  as  a  reason  that  its  mine  is  now  poor  and 
becoming  poorer,  I  can  not  discern  either  justice  or  expediency  in  the  request." 

Recognizing  the  catastrophe  of  a  stoppage  of  the  big  mine  and  his  responsibility 


AUSTRALIA.  95 

in  the  court,  Mr.  Justice  Higgins  said  it  would  be  untrue  to  say  the  award,  by 
fixing  the  wage  too  high,  caused  the  stoppage.  What  would  stop  the  mine  would  be 
the  deficiency  of  payable  ore. 

Of  course  it  was  a  catastrophe  that  this  mine  should  be  closed  down,  but  such  a 
catastrophe  must  take  place  in  every  mine  at  some  time,  and  in  this  case  must  occur 
after  a  very  short  interval. 

The  sliding  scale  of  wages,  being  only  possible  with  a  reduction  of  living  wages, 
could  not  be  put  in  the  award,  for  to  surrender  any  part  of  the  living  wage  would 
be  to  surrender  the  vital  point  of  unionist  effort  on  behalf  of  an  employee. 

The  reduction  of  expenditure,  £33.000  ($160,000)  a  half  year  as  a  result  of 
reducing  wages  might  mean  a  dividend,  but  it  would  have  to  come  out  of  the  work- 
men's necessaries  of  life,  would  be  distributed  at  the  cost  of  the  workmen's  breakfast 
tables. 

It  would  not  be  fair  to  blame  the  directors  in  their  difficult  position  of  responsi- 
bility to  the  shareholders  for  not  proceeding  with  milling  and  mining  on  the  strength 
of  undistributed  profits.  He  did  not  feel  justified  in  ordering  the  company  to  continue 
mining  under  the  circumstances. 

"It  might  be,"  Mr.  Justice  Higgins  held,  "that  he  had  power  under  the  act  to 
compel  continuance  of  work  at  the  mine,  but  he  would  not  exercise  such  a  power 
except  in  extreme  cases.  It  was  not  for  the  court  to  dictate  to  employers  what  work 
they  should  carry  on." 

TWO  SIGNIFICANT  STATEMENTS. 

The  two  significant  statements  in  the  decision  of  Justice  Higgins  are 
(a)  that  a  living  wage  must  be  secured  to  employees,  a  living  wage 
being  defined  as  "the  money  necessary  to  satisfy  the  normal  needs  of  an 
average  employee  regarded  as  a  human  being  in  a  civilized  community" ; 
(&)  that,  "if  a  man  can  not  maintain  his  enterprise  without  cutting 
down  the  wages  which  are  proper  to  be  paid  to  his  employees — at  all 
events  the  wages  that  are  essential  to  their  living — it  would  be  better 
that  he  should  abandon  the  enterprise. ' ' 

These  doctrines  will  seem  to  a  good  many  people  in  the  United  States 
and  elsewhere  as  novel  and  startling,  especially  where  labor  unions  are 
not  strong  enough  to  fix  and  to  maintain  a  minimum  wage.  To  those 
living  where  the  law  of  supply  and  demand  in  the  labor  market  fixes 
the  wage  without  let  or  hindrance,  and  where  there  is  thus  no  downward 
limit  to  wages,  it  will  seem  a  most  radical  step  for  the  law  to  step  in 
and  to  say  to  the  employer  in  the  matter  of  reducing  wages  "Thus  far 
shalt  thou  go  but  no  farther. ' '  To  those  also  who,  when  times  are  hard, 
and  to  keep  an  industry  going,  cut  wages  below  a  living  rate,  it  may 
seem  most  radical  for  the  law  to  say  that  unless  living  wages  can  be 
paid  the  industry  had  better  be  abandoned. 

Yet  these  sentiments  expressed  in  court,  and  published  in  the  press, 
created  little  or  no  comment  in  Australia,  and  were  accepted  there  as 
sound  and  proper. 

The  decision  caused  much  unfavorable  criticism  among  many  employ- 
ers, not  because  of  the  foregoing  sentiments,  but  because  they  main- 
tained that  the  spirit  of  the  decision  and  the  spirit  manifested  by  the 
court  in  the  course  of  the  long  trial,  evidenced  a  bias  in  favor  of  the 


96  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

employees.  The  decision  also  caused  disappointment  on  the  part  of 
the  employees,  because  the  court  did  not  exercise  its  discretionary  power 
in  ordering  the  mine  owners  to  resume  operations  in  full  on  the  terms 
of  the  award. 

CONCLUSION. 

The  sentiment  of  many  employers  throughout  Australia  was  strongly 
against  the  commonwealth  compulsory  arbitration  act  of  1904.  This 
was  demonstrated  by  various  resolutions  passed  on  several  occasions  by 
various  employers'  conventions,  from  among  which  I  quote  the  following : 

ARBITRATION    ACT. 

(Extracts   from    presidents'    addresses    before    the    Australian    Employers'    Federation 
Conference,  1905,  pages  8-9  of  the  report.) 

Dealing  with  the  celebrated  arbitration  act,  I  feel  that  the  word  "compulsory"' 
should  never  have  been  left  out,  because  it  is  really  compulsory  arbitration  under 
that  statute.  It  is  purely  class  legislation,  and  is  for  the  purpose  of  strengthening 
the  unions.  It  is  an  experiment  to  increase  the  wages  of  the  workers  and  to  give 
them  better  conditions  of  employment  in  defiance  of  the  economic  laws,  and  it  will, 
in  my  opinion  as  a  business  man,  prove  an  utter  fallacy.  This  act  will  never  work. 
We  are  all  anxious  for  conciliation,  but  we  will  not  accept  compulsory  arbitration. 
Neither  will  the  people.  That  is  clearly  proved  by  the  actions  of  the  unions  in  New 
South  Wales.  So  long  as  the  wind  blows  the  way  they  want  it  to,  the  act  is  all 
right  in  their  minds,  but  directly  the  judge  decides  against  them  the  act  becomes 
a  very  bad  one  to  their  idea.  The  history  of  compulsory  arbitration  in  New  Zealand 
and  New  South  Wales  leads  us  to  the  certain  conclusion  that  it  is  practically 
impossible  in  administration. 

The  act  is  a  distinct  interference  with  the  liberty  of  the  subjoct,  and  I  am  confident 
that  the  high  court,  before  which  the  question  will  have  to  be  fought,  will  confirm 
our  opinion. 

Regardless  of  the  expressed  intention  of  the  framers  of  the  constitution,  and  of 
the  emphasized  opinions  of  eminent  legal  authorities  that  it  was  ultra  vires,  the 
compulsory  arbitration  bill  became  an  act.  It  was  framed  on  the  pernicious  lines  of 
the  New  South  Wales  act,  which  the  trying  and  humiliating  experience  of  that 
state  has  shown  to  be  an  instrument  for  the  oppression  of  employers  and  many 
employees,  a  provoker  of  industrial  strife,  a  great  check  to  progress,  and  a  violation 
of  the  very  foundations  of  the  principle  of  British  freedom  on  which  our  nation 
has  been  built  up,  and  which  cost  our  ancestors  so  much  to  win.  It  has  further 
proved  itself  utterly  powerless  to  enforce  decisions  under  it  against  any  except 
employers.  It  therefore  perpetrates  a  national  crime  against  the  body  politic,  of 
oppression  on  the  one  side  and  license  on  the  other,  for  there  is  no  appeal,  and  which 
if  continued  must,  by  the  workings  of  the  great  moral  law,  end  in  disruption  and 
destruction. 

(Motion  passed  by  Employers'  Federation,  page  18,  1905  report.) 
That  this  conference  of  employers  confirm  the  determination  of  the  various 
employers'  associations  not  to  register  under  the  commonwealth  conciliation  and 
arbitration  act,  as  the  act  is  in  derogation  of  the  common  law,  and,  in  our  opinion, 
is  a  violation  of  state  rights ;  and,  further,  that  by  so  refraining  a  protest  is  entered 
against  the  act,  whereas  registration  might  be  taken  to  be  an  acceptance  of  its 
obligations. 

The  foregoing  sentiments  were  expressed  and  resolutions  adopted  in 
1!)05,  shortly  after  the  commonwealth  arbitration  law  went  into  effect. 
Four  years  have  since  intervened  and  the  disastrous  results  anticipated 
have  not  taken  place. 


AUSTRALIA.  97 

Aside  from  the  expression  on  the  part  of  a  few  employers,  I  found  no 
.•serious  public  sentiment  in  favor  of  abolishing  the  commonwealth  con- 
ciliation and  arbitration  act. 

In  my  opinion  the  law  as  applied  to  the  commonwealth  has  come  to 
stay  in  its  present  or  perhaps  somewhat  modified  form.  The  point  has 
been  made  that  the  men  will  abide  by  the  awards  in  good  times  when 
wages  go  up  but  not  in  bad  times  when  wages  are  cut.  From  the  atti- 
tude of  the  court,  and  the  sentiment  expressed  by  Justice  Higgins  in 
the  Broken  Hill  case  herein  quoted,  it  must  be  evident  that  should  times 
get  harder  than  they  have  been  during  the  depression  of  the  past  twelve 
months,  there  is  no  likelihood  of  wages  being  increased,  nor  is  there  a 
likelihood  of  wages  being  legally  cut  below  the  minimum  or  so-called 
living  wage.  Hence,  there  is  little  probability  of  the  men  refusing  to 
abide  by  the  court  decisions. 

In  the  event  of  hard  times,  the  poorest  workers  are  likely  to  be 
dropped,  and  any  wage  above  the  legal  minimum  may  disappear.  But 
until  the  courts  and  public  sentiment  in  Australia  change  their  attitude, 
the  minimum  wage  is  likely  to  be  maintained  by  the  federal  compulsory 
arbitration  court,  thus  tending  to  the  perpetuation  of  Australian  indus- 
trial peace. 

Furthermore,  state  wages  boards  can  not  deal  with  interstate  issues, 
such  as  maritime  matters  or  the  grievances  of  the  waterside  workers, 
an  organization  extending  around  the  Australian  continent,  and  hence, 
a  commonwealth  or  federal  court  is  imperative. 

Unless,  as  already  stated,  unexpected  and  serious  ills,  greater  than 
any  thus  far  developed,  should  manifest  themselves,  the  commonwealth 
industrial  act  is  likely  to  remain  permanently  on  the  Australian  statute 
.books. 


98  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 


NEW  ZEALAND. 


There  is  much  in  New  Zealand  to  remind  the  California!!  of  his  own 
state.  He  finds  there  the  same  temperate  and  salubrious  climate,  the 
same  mountainous  country  with  great  interspersing  valleys,  the  same 
great  areas  devoted  to  grain  growing,  and  to  pastoral  pursuits.  He 
finds  grown  in  the  dominion,  only  in  a  limited  way,  however,  the  pear, 
the  peach,  the  apple,  the  plum,  the  quince,  the  apricot,  the  fig,  the  wal- 
nut, the  cherry,  the  gooseberry,  the  currant,  the  strawberry,  the  rasp- 
berry, the  orange,  the  lemon,  the  lime,  the  grape,  and  the  banana. 
Orchard  planting  is  progressing,  and  if  New  Zealand  had  a  market  for 
the  product  of  its  trees  and  vines,  it  would  develop  into  a  fruit  countiy 
that  would  rival  California. 

The  people  of  New  Zealand  likewise  remind  a  Californian  of  those  of 
his  own  state.  He  finds  among  the  New  Zealanders  the  same  generous 
hospitality,  the  same  free,  liberal,  independent  spirit,  the  same  open 
hand  and  open  mind  that  characterize  the  people  of  the  Golden  State. 

The  area  of  New  Zealand,  including  the  north  and  south  islands  and 
the  group  of  smaller  islands,  is  104,751  square  miles.  Its  present  popu- 
lation is  approximately  1,000,000. 

The  land  suited  for  agricultural  purposes  is  estimated  at  13,000,000 
acres.  The  dominion  has  a  coast  line  of  4,330  miles.  In  point  of  transit 
it  is  located  about  four  days '  sail  from  Australia  and  on  a  bee  line  about 
seventeen  days'  sail  from  San  Francisco.  In  the  absence  of  direct  com- 
munication with  San  Francisco,  the  voyage  via  Vancouver  now  takes 
about  thirty  days. 

New  Zealand  is  first  of  all  a  pastoral,  then  an  agricultural  country. 
It  also  has  abundant  resources  in  its  mines  and  forests.  It  has  great 
quantities  of  forests  and  valuable  timber  lands,  and  also  much  mining 
country.  Large  gold  and  coal  deposits  are  found  here.  The  yield  of  its 
gold  mines  thus  far  aggregates  over  $357,000,000. 

The  first  settlement  of  New  Zealand  was  in  1825.  There  has  since 
been  a  steady  but  not  phenomenal  growth,  due  to  its  distance  and  isola- 
tion from  great  populated  occidental  centers.  Its  nearest  neighbors, 
aside  from  the  Australians,  are  the  untold  millions  of  Asia,  who,  if  unre- 
stricted, would  doubtless  speedily  overrun  this  land  that,  so  to  speak, 
flows  with  milk  and  honey. 

New  Zealand  is  governed  by  a  lower  and  upper  house  and  a  cabinet, 
all  modeled  after  the  British  form  of  government.  The  members  of  the 


NEW  ZEALAND.  99 

lower  house  are  popularly  elected  for  three  years  and  receive  £300  a 
year  ($1,455).  The  members  of  the  upper  house  are  appointed  by  the 
party  in  power  for  seven  years,  and  receive  £200  a  year  ($970) . 

Unlike  the  commonwealth  of  Australia  or  the  United  States,  New 
Zealand  politically  is  treated  as  a  unit.  The  Parliament  legislates  for 
the  dominion  as  if  but  one  state. 

This,  as  compared  with  the  other  governments  just  referred  to,  simpli- 
fies matters  materially  and  does  not  involve  the  consequent  problems 
of  state  rights  nor  arouse  feelings  of  state  jealousies. 

No  one  thing  that  New  Zealand  has  done  has  commanded  for  her 
greater  attention  abroad  than  her  modern  legislation  in  dealing  with 
labor  problems.  This  country  has  been  bold  enough  to  take  the  initia- 
tive and  to  do  pioneering  along  new  and  untried  lines,  while  the  rest  of 
the  world  has  stood  by  and  with  great  interest  looked  on.  Her  greatest 
fame  has  come  from  the  enactment  of  what  has  become  known  as  the 
compulsory  arbitration  laws,  having  in  viewT  (a)  the  wiping  out  of  the 
evil  of  sweating ;  ( & )  the  peaceful  settlement  of  labor  disputes,  in  order 
to  prevent  strikes  and  lockouts. 

Her  isolation,  her  compactness,  her  great  wealth,  her  comparatively 
small  population,  her  miniature  industrial  enterprises,  have  made  it  pos- 
sible for  her  to  experiment  along  legislative  lines  that  other  countries 
not  so  favorably  circumstanced  would  hesitate  even  to  consider. 

Whatever  mistakes  might  be  made  in  such  legislation  could  be  rectified 
within  a  reasonable  time  without  serious  loss  or  great  dislocation  of  any 
industry.  Whatever  financial  damage  might  be  done  was  not  likely  to 
be  serious  enough  to  do  lasting  injury. 

The  initial  labor  legislative  steps  were  taken  shortly  after  the  great 
sympathetic  maritime  strike  of  1890.  In  this  year  the  trades  unions 
stood  well  financed.  The  seamen's  union  went  on  a  strike  sympathet- 
ically with  the  Australian  seamen,  who  struck  because  of  employment 
of  Asiatic  crews.  The  wharf  laborers  also  went  out,  and  were  supported 
by  other  unions.  The  coast  trade  was  paralyzed.  Public  sentiment, 
however,  was  against  the  strike. 

The  unions  were  then  few  in  number.  Rural  workers  came  in  and 
took  the  strikers'  places.  In  the  end,  the  unions  lost  the  strike  and 
were  impoverished.  This  led  the  unionists  to  believe  that  the  strike  is 
not  the  best  way  to  secure  their  ends.  It  was  decided  by  them  that  in 
the  future  they  would  resort  to  the  ballot.  In  consequence,  with  the  aid 
of  labor,  the  first  Liberal  administration  was  brought  into  power,  by  the 
end  of  1890. 

At  that  time  it  was  claimed  that  the  farmers  were  struggling  under 
heavy  mortgages.  Money  lenders  were  grabbing  the  land.  Interest 
being  from  ten  to  fifteen  per  cent.  The  first  act  of  the  new  Liberal  gov- 


100  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

eminent  was  to  borrow  money  at  three  per  cent  and  loan  it  to  the  settlers 
at  four  and  one  half  per  cent.  This  rate  included  one  per  cent  for  a 
sinking  fund  to  go  toward  wiping  out  in  time  the  principal,  which  when 
compounded  it  was  able  to  do  in  a  period  of  about  thirty-two  years. 

The  new  administration  also  passed  a  factory  act,  seeking  the  welfare 
of  female  and  child  labor.  In  early  days  the  government  sold  land  for 
$2.50,  and  even  as  low  as  $2  an  acre,  resulting  in  building  up  a  landed 
aristocracy.  The  government  then  passed  an  act  empowering  itself  to 
buy  back  as  much  of  the  land  as  might  be  required  from  time  to  time  and 
dispose  of  it  in  small  parcels.  Later,  the  single  land  tax  was  adopted. 
The  government  reserved  to  itself  the  right  to  buy  land  at  the  valuation 
for  assessment  put  upon  it  by  the  owner  plus  ten  per  cent.  Seeing  what 
the  government  had  done  for  the  farmers,  the  workers  asked  '  '  What  are 
you  going  to  do  for  us  ?  '  '  The  government  responded  in  various  acts. 

The  result  of  the  maritime  1890  strike  led  the  then  Labor  Minister 
Pember  B.  Reeves,  Labor  Secretary  Edward  Tregear  and  others  to  see 
if  there  was  not  some  other  way  than  strikes  to  settle  labor  disputes. 
If  judges  can  decide  matters  affecting  life  and  death  and  millions  in 
property,  why  not  let  them  decide  matters  affecting  wages?  "There 
is  another  party  to  labor  disputes,  '  '  men  such  as  these  held,  '  '  the  great 
public.  There  are  not  two  persons  involved  in  a  strike,  but  three," 
they  said.  So  New  Zealand  proposed  to  say,  "We  are  not  going  to  allow 
you  two,  employers  and  men,  to  disturb  and  dislocate  our  affairs.  '  '  It 
proposed  to  say  to  the  parties  to  the  dispute,  "Take  your  industrial 
troubles  before  a  disinterested  tribunal  who  shall  decide  between  you.  '  ' 

In  a  document  issued  by  the  Labor  Department  of  New  Zealand  the 
following  appears  : 

SWEATING. 

The  New  Zealand  legislature  decreed  that  all  textile  work  should  be  done  in  fac- 
tories, and  that  all  workrooms  employing  two  or  more  persons  must  be  registered 
under  the  act.     It  is  also  forbidden  to  sweat  by  permitting  (i.  e.,  generally,  by  exer- 
cising indirect  compulsion)   a  factory  worker  to  take  home  work  to  finish,  and  so  to 
toil  through  unreasonably  long  hours  in  probably  unhealthy  surroundings. 

The   following   is   a   short   list   of   earnings   and   hours   worked   in   some   of   the 
sweated  trades  in  England  shown  in  the  exhibit  : 

Average       Average  earn- 

Description  of  work.  Rates  paid.  working  day.   ings  per  week. 

Bag  making  _____________  4d.  (8c)  per  dozen.     16  hours.     4s.  Od.  (96c) 

Matchbox  making  ____  2%s.  (62c)  per  gross.      16  hours.     7s.  6d.  ($1.80) 

Boys'  knickers  _________  9d.  (18c)  per  dozen.     16  hours.     9s.  Od.  ($2.16) 

Fur  tassel  work  _____  Is.  3d.  (31c)  per  gross.      10  hours.     6s.  Od.  ($1.44) 

Skirts  __________________  5d.  (lOc)  per  piece.      14  hours.     5s.  Od.  ($1.20) 

Button  carding  _________  i£d.  (Ic)  per  gross.      11  hours.     3s.  Od.  (72c) 


Such  earnings,  miserable  as  they  are,  do  not  always  represent  the  work  of  a 
single  person  ;  children  of  the  most  tender  age  are  called  on  to  assist  the  parent  to 
keep  body  and  soul  together.  Nor  are  the  hours  limited  to  those  above  mentioned. 
We  read  of  women  who  work  in  such  industries  from  4  a.  m.  till  midnight,  or  who 
never  go  to  bed  on  the  same  day  that  they  get  up.  How  is  it  possible  to  keep  the 


NEW   /KALAND.  101 

home  or  the  person  in  cleanliness  and  respectability  when  every  moment  of  the 
working  day  has  to  be  devoted  to  ceaseless  and  degrading  toil?  Moreover,  the  mis- 
erable earnings  quoted  above  by  no  means  represent  the  amount  which  can  be 
devoted  to  the  sustenance  of  life  and  warmth,  in  food  and  clothing.  A  mother  and 
daughter  working  together  at  card  hooks  and  eyes  earn  3s.  4d.  (SOc. )  weekly  between 
them,  but  the  rent  of  their  room  is  3s.  6d.  (S4c. ).  Here  other  members  of  the  family 
have  to  help.  An  old  woman  and  her  brother,  sitting  fifteen  hours  daily  sewing 
buttons  on  cards,  earn  3s.  Gd.  (84c. )  weekly  between  the  two;  the  rent  is  3s.  9d. 
(90c. ),  but  the  woman  has  some  church  schools  to  clean,  so  they  drag  along.  A 
slipper  maker  earning  Gs.  3d.  ($1.50)  weekly,  pays  2s.  6d.  (COc. )  rent.  So  goes  on 
the  awful  story  of  human  toil  and  suffering.  To  call  a  system  which  exists  on  such 
maker  earning  Gs.  3d.  ($1.50)  weekly,  pays  2s.  6d.  (60c)  rent.  So  goes  on  the 
awful  story  of  human  toil  and  suffering.  To  call  a  system  which  exists  on  such 
foundations  a  system  of  wage-slavery  is  to  use  an  improper  term  and  to  debase 
the  word  "slavery,"  because  no  slave  is  worked  for  eighteen  out  of  twenty-four  hours 
on  insufficient  food  by  a  master  who  values  his  property. 

The  following  is  taken  from  the  New  Zealand  Yearbook  for  1908, 
issued  by  the  government : 

Labor  Laws,  page  515 :  The  labor  laws  have  been  passed  in  an  effort  to  regulate 
certain  conditions  affecting  employer  and  employed.  Their  scope  embraces  many 
difficult  positions  into  which  the  exigencies  of  modern  industrial  life  have  forced 
those  engaged  in  trades  and  handicrafts.  The  general  tendency  of  these  laws  is  to 
ameliorate  the  conditions  of  the  worker  by  preventing  social  oppression  through 
undue  influence,  or  through  unsatisfactory  conditions  of  sanitation.  It  will  undoubt- 
edly be  found  that,  with  the  advance  of  time,  these  laws  are  capable  of  improvement 
and  amendment,  but  they  have  already  done  much  to  make  the  lives  of  operatives 
of  fuller  and  more  healthy  growth,  and  their  aim  is  to  prevent  the  installation  of 
abuses  before  such  abuses  attain  formidable  dimensions. 

Page  516 :  Sweating  has  almost  disappeared  in  New  Zealand  by  the  prohibition  of 
subcontracting  in  the  issue  of  textiles  to  be  made  up  into  garments.  The  factories 
act  is  probably  one  of  the  most  complete  and  perfect  laws  to  be  found  on  the  statute 
book  of  any  country,  and  is  generally  appreciated  by  workers,  while  the  honest,  fair- 
dealing  employer  is  himself  thereby  protected  from  the  unscrupulous  proceedings  of 
the  piratical  competitors. 

LABOR    LEGISLATION. 

New  Zealand  has  now  been  living  under  its  labor  legislation  for  a 
period  of  fifteen  years.  During  this  time  the  law  has  undergone  many 
modifications  and  changes  and  while  the  underlying  principle  in  the 
mind  of  the  framer  of  the  original  law  remains  the  same,  its  method  of 
administration  and  the  scope  of  its  usefulness  are  widely  different  from 
the  original  idea. 

The  following  excerpts  from  a  pamphlet  published  by  the  New 
Zealand  Labor  Department,  give  a  condensed  history  of  the  legislation 
to  date : 

Before  the  advent  of  the  ministry,  which  has  been  continuous  as  the  Ballauce- 
Seddon-Ward  administration,  there  was  no  truck  act  nor  factories  act,  no  shop  and 
office  act,  no  arbitration  act,  no  shearers'  accommodation  act,  no  workman's  compen- 
sation for  accidents'  act.  It  was  a  world  in  which  men  and  women  toiled  under 
relentless  conditions,  each  worker  making  the  best  bargain  with  his  employer  which 
necessity  would  permit  him  to  do.  Often  the  hours  were  long,  the  overtime  unpaid 
for,  the  holidays  nil,  payment  made  partly  in  goods  (truck),  and  all  the  risks  of 
industrial  life  carried  on  at  the  worker's  expense  in  life  and  limb.  • 


102  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

THE  INDUSTRIAL  CONCILIATION  AND  ARBITRATION   ACT. 

Page  4 :  In  1894  an  act  to  encourage  the  formation  of  unions  was  passed,  and 
named  "The  Industrial  Conciliation  and  Arbitration  Act."  It  provides  that  any 
number  of  persons,  not  being  less  than  seven,  might  form  an  industrial  union  of 
workers  or  employers,  and  a  number  of  unions  could  be  registered  as  an  association. 
The  colony  was  divided  into  industrial  districts,  each  district  having  a  board  of 
conciliation  for  the  settlement  of  trade  disputes,  with  appeal  to  the  court  of  arbi- 
tration having  jurisdiction  over  both  islands.  The  board  consisted  of  four,  five  or 
six  members  (generally  four),  to  be  chosen  as  representatives  of  employers  and 
workers,  and  these  members  were  to  elect  some  other  person  as  chairman,  failing  with 
selection  the  governor  should  appoint.  The  members  of  the  board  held  office  for 
three  years.  Strikes  or  lockouts  were  declared  illegal  if  taking  place  while  pro- 
ceedings were  pending  before  board  or  court.  Special  boards  of  experts  in  a  trade 
could  be  elected  by  employers  and  workmen's  unions  for  each  dispute,  but  this 
provision  was  never  taken  advantage  of  until  quite  lately.  The  board  was  to 
endeavor  to  bring  about  amicable  settlement,  and  if  this  took  place  an  agreement 
could  be  entered  into.  Failing  settlement  a  recommendation  was  made  by  the  board, 
and  if  not  accepted,  any  party  could  refer  the  matter  to  the  arbitration  court.  The 
court  of  arbitration  consisted  of  three  members,  two  of  whom  were  appointed  by 
the  governor,  one  on  the  recommendation  of  industrial  associations  (not  merely 
unions)  of  workers  in  the  colony,  and  the  other  on  a  similar  recommendation  by 
associations  of  employers.  The  third  member  was  to  be  a  judge  of  the  supreme 
court  as  president.  The  court  could  deal  with  all  industrial  disputes  referred  to  it, 
and  make  awards,  of  not  exceeding  two  years'  duration,  binding  on  every  person 
declared  to  be  bound.  The  awards  could  be  enforced  in  the  supreme  court,  but  any 
award  within  the  jurisdiction  of  a  district  or  magistrate's  court  could  be  taken  to 
such  court.  There  was  a.  corporate  limit  of  £500  ($2,425)  for  enforcement,  and 
an  individual  limit  of  £10  ($48.50).  The  government  railway  commissioners  were 
deemed  employers,  but  not  any  other  government  department. 

In  1895  the  number  of  employers  requisite  to  form  a  union  was  reduced  from 
seven  to  five;  two  experts  (one  on  each  side)  were  provided,  if  necessary,  to  sit 
with  board  or  court.  The  governor  could  appoint  a  member  of  a  board  or  court 
if  unions  failed  to  elect,  and  any  employer,  association  or  union  could  be  joined 
as  a  party  to  a  dispute  by  a  board  or  court. 

In  1898  the  title  of  the  principal  act  as  to  its  being  an  act  "to  encourage  the 
formation  of  unions"  was  selected.  The  court  was  empowered  to  determine  what 
constituted  a  breach  of  its  own  award,  and  the  maximum  penalty  was  fixed  at 
£500  ($2,425).  The  court  was  not  allowed  to  fix  the  age  for  commencement  or 
termination  of  apprenticeship.  The  union  had  to  pass  a  special  resolution  before  it 
could  file  a  dispute,  while  the  court  was  permitted  to  prescribe  the  minimum  wage 
and  provide  for  underrate  permits.  By  the  amending  act  of  1900  the  definition  of 
industry  was  altered  to  include  "any  employment  in  which  a  worker  is  employed." 
The  office  of  registrar  was  transferred  from  the  "Registrar  of  Friendly  Societies  to 
the  Secretary  for  Labor."  Preference  to  unionists  became  included  among  the 
industrial  matters  which  could  be  dealt  with.  The  minimum  number  of  employers 
necessary  to  form  a  union  was  reduced  to  two.  The  registrar  could  refuse  to 
register  two  industrial  unions  of  the  same  business  within  the  same  industrial 
district.  Industrial  agreements  remaining  in  force  until  superseded  or  until  the 
union  of  workers  was  canceled,  while  parties  could  be  added  during  its  currency. 
The  recommendations  of  the  conciliation  board  became  an  agreement  if  no  objection 
was  lodged  within  a  month.  The  two  elected  members  of  the  arbitration  court  were 
to  be  recommended  by  unions  of  employers  and  workers,  not  by  associations.  Presi- 
dent and  one  member  to  be  a  quorum  of  the  court.  The  maxinunn  currency  <>;'  an 
award  was  extended  from  two  years  to  three,  but  then  continued  in  force  until  a 
new  award  was  made.  Beside  the  original  parties  to  an  award,  such  award  bound 
all  persons  engaging  in  the  business  while  the  award  was  in  force.  Power  was 
given  to  amend  an  award  and  to  extend  it  in  cases  of  one  part  of  the  colony  unfairly 
competing  against  another.  Instead  of  railway  commissioners  the  minister  for 


NEW  ZEALAND.  103 

railways  could  enter  into  the  Amalgamated  Society  of  Railway  Servants,  but  in 
matters  of  the  government  railways  the  conciliation  board  could  not  interfere. 

In  1901  special  boards  could  be  set  up  by  application  of  any  party  to  a  dispute, 
whereas  prior  to  this  date  all  parties  to  a  dispute  must  apply  for  such  special  board. 
•Court  received  power  to  limit  the  locality  of  an  award  within  an  industrial  district 
or  to  extend  it  beyond  that  district.  The  registrar  was  empowered  to  cancel  unions 
if  within  a  reasonable  time  no  returns  from  the  union  were  forthcoming.  Either 
party  could  refer  a  dispute  already  filed  with  the  conciliation  board  direct  to  the 
arbitration  court.  (This  section  is  the  famous  "Willis  Blot,"  and  resulted  in  the 
ultimate  paralysis  of  conciliation  boards.)  The  court  could  make  one  award 
applicable  to  several  trades  in  any  one  business,  e,  g.,  could  make  for  a  woolen  mill 
•one  award  covering  enginemen,  dyers,  sorters,  weavers,  etc. 

By  the  amending  act  of  1903  a  deputy  registrar  of  unions  could  be  appointed. 
An  employer  was  not  entitled  to  dismiss  any  worker  merely  because  that  worker 
was  entitled  to  the  benefit  of  an  award,  or  because  he  was  a  unionist.  Combinations 
of  employers  or  of  unionists  to  endeavor  to  defeat  an  award  were  forbidden. 
Inspectors  of  factories  and  inspectors  of  mines  became  inspectors  of  awards,  and  were 
^charged  with  the  duty  of  seeing  the  award  carried  out.  The  arbitration  court 
emergency  act  provided  substitutes  for  members  of  the  court  in  case  of  illness  or 
other  cause  of  absence,  and  pending  such  appointment  of  substitute  the  president 
-could  recommend  the  appointment  of  an  acting  member. 

In  1905  a  consolidating  act  was  passed,  and  is  that  in  force  as  "the  principal  act" 
at  date ;  and  also  a  separate  amending  act  became  a  law.  The  latter  made  provision 
for  binding  any  worker  (unionist  or  nonunionist)  employed  by  any  employer  on 
"whom  an  award  was  binding.  A  more  stringent  section  than  that  of  1903  dealt 
with  dismissing  or  suspending  a  worker,  or  with  the  worker  discontinuing  work 
during  the  pendency  of  a  dispute.  The  proceedings  with  regard  to  underrate  permits 
wore  fully  set  out.  Any  one  who  joined  a  strike  or  lockout,  or  aided  or  abetted  a 
strike  or  lockout,  was  made  guilty  of  breach  of  award.  (Note:  Previously  a  strike 
or  lockout  was  only  punishable  when  taking  place  during  the  currency  of  proceedings 
before  a  board  or  court.)  A  worker  was  deemed  to  be  dismissed  when  suspended 
for  a  longer  period  than  ten  days.  In  1906  a  short  act  was  passed  for  the  purpose 
of  amending  the  statutory  position  of  the  officer  presiding  over  the  arbitration  court, 
providing  for  his  permanent  appointment,  and  substituting  the  title  of  "judge"  for 
i lint  of  "president."  A  registrar  of  the  court  is  also  provided  for.  The  remuneration 
of  the  elected  members  of  the  court  is  fixed  at  £500  ($2,425)  per  annum  in  addition 
to  traveling  expenses. 

The  arbitration  act,  difficult  to  follow  in  all  these  amendments,  suffered  from 
this  cause  of  absolute  necessity  of  change,  as  time  and  experience  presented  new 
•difficulties  to  be  overcome.  It  entered  its  legislative  life  through  an  utterly  unknown 
field  of  action,  and  with  continually  changing  circumstances  marking  its  industrial 
path.  It  is,  therefore,  little  to  be  wondered  at  that  so  experimental  and  tentative 
•a  measure  could  not  be  at  first  guarded  at  every  point,  nor  adapt  itself  automatically 
-to  meet  every  subtle  evasion  of  its  powers. 

DEALING  PARTICULARLY  WITH  THE  LABOR  LEGISLATION  OF  THE  YEAR  1908. 

First  and  foremost  must  be  noted  the  changes  made  in  the  industrial  conciliation 
.•uid  arbitration  act,  the  new  measure  coming  into  force  on  the  first  day  of  Jan- 
uary, 1909. 

Conciliation  boards  are  abolished,  and  commissioners  of  conciliation  are  to  be 
appointed  for  three  years  by  the  government,  such  commissioners  to  promptly  visit 
any  locality  in  which  an  industrial  dispute  is  reported  to  exist.  If  a  commissioner 
is  unable  to  settle  the  dispute  satisfactorily,  it  may  be  referred  to  a  council  of 
•conciliation,  of  which  the  commissioner  is  chairman.  This  council  consists  of  two, 
four  or  six  assessors,  nominated  in  equal  number  by  the  parties  to  the  dispute, 
^uch  assessor  must  be  engaged  in  the  industry  to  which  the  dispute  relates,  with 
the  exception  that  one  on  either  side  may,  with  the  approval  of  the  commissioner, 
toe  a  person  not  so  engaged.  In  this  council  the  commissioner  has  only  a  casting 


104  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

vote,  and  that  for  the  maintenance  of  business  before  the  council,  not  for  the- 
purpose  of  making  an  industrial  recommendation. 

The  council  has  power  to  summon  witnesses,  take  evidence  on  oath,  etc.,  in  the- 
endeavor  to  bring  about  the  settlement  of  the  dispute,  but  it  is  not  in  any  sense  a 
tribunal,  or  with  any  inherent  powers  of  settlement.  If  the  council  agree  on  certain 
line  of  action  the  matter  is  submitted  to  the  principals  on  either  side  (employers  or 
workers'  union),  and  ratified  by  these  principals,  an  industrial  agreement  is  filed 
with  the  clerk  of  awards,  whereupon  the  matter  is  at  an  end. 

Should  the  council  fail'  to  come  to  an  agreement,  it  shall,  not  earlier  than  one 
month  or  later  than  two  months  after  the  date  fixed  for  hearing  the  dispute,  notify 
the  clerk  of  awards.  It  may,  however,  make  a  recommendation,  if  the  assessors  are 
unanimous  in  coming  to  such  a  conclusion,  before  forwarding  the  notification,  but 
the  recommendation  itself  has  no  power  to  bind  or  restrict  in  any  way,  and  may 
be  considered  as  only  of  value  in  minor  directions,  viz.,  as  a  guide  to  public  opinion 
in  the  matter  and  a  suggestion  towards  settlement.  The  dispute,  failing  its  settle- 
ment by  the  council,  goes  automatically  to  the  arbitration  court. 

It  will  at  once  be  perceived  how  different  the  above  procedure  is  from  that 
formerly  regulating  the  proceedings  of  conciliation  boards.  The  members  of  those- 
boards  were  appointed  for  three  years,  and  all  varieties  of  trade  disputes  came 
before  them.  Each  representative  of  employer  or  worker  on  the  board  was  expert 
only  in  his  own  trade,  and  practically  ignorant  of  the  technicalities  of  all  others. 
Consequently,  the  facts  of  any  dispute  could  only  be  elicited  by  the  profuse  evidence 
of  witnesses,  and  through  such  evidence  by  the  temporary  education  of  the  board 
in  that  particular  industry.  The  delay,  the  expense,  and  the  militant  spirit  invoked 
by  the  public  examination  and  cross-examination  of  witnesses  destroyed  any  tendency 
to  conciliation  that. the  boards  may  have  at  first  possessed.  They  grew  into  almost 
universal  discredit,  so  that  it  became  easy  to  supersede  them  by  the  amendment 
(moved  in  the  house  of  representatives  by  a  private  member),  which  allowed  either 
party  to  a  dispute  to  take  it  direct  to  the  arbitration  court.  It  was  publicly  said 
to  be  useless  to  have  a  case  heard  twice,  once  before  the  board  and  then  before  the 
court,  when  the  court  could  be  applied  to  directly.  The  result,  however,  was  to- 
congest  the  arbitration  court  with  business;  to  delay  its  findings,  whether  in  regard 
to  disputes  or  to  breaches  of  awards.  There  would  have  been  little  dissatisfaction 
expressed  for  years  against  the  arbitration  court  could  the  serious  delays  and  incon- 
veniences arising  from  its  overwork  have  never  occurred.  Had  the  boards  fulfilled 
the  promise  with  which  they  were  instituted,  had  it  been  possible  for  them  to  be 
kept  as  a  pure  medium  for  amicable  arrangements  between  disputants,  then  the 
channels  of  the  court  would  not  have  become  clogged  and  choked  with  demands  for 
arbitrary  judgments. 

The  new  act  provides  full  definition  of  "strike"  and  "lockout."  These  are  inter- 
preted to  be  the  action  of  discontinuing  work  or  business  as  modes  of  industrial 
compulsion,  so  that  they  have  no  continuous  existence  as  offenses,  although  they 
are  continuous  in  respect  to  aiding  and  abetting.  Imprisonment  for  striking  or  for 
abetting  a  strike  is  abolished  entirely  for  ordinary  strikes,  and  the  penalty  for  each 
worker  who  takes  part  in  one  not  exceeding  £10  ($48.50).  A  similar  penalty  falls 
on  a  worker  who  aids  or  instigates  a  strike.  Every  union  that  instigates  or  aids  a 
strike  is  liable  to  a  penalty  not  exceeding  £500  ($2,425).  The  terms  "strike"  and 
"lockout"  are  herewith  made  conditional  so  as  to  mean  only  strikes  or  lockouts 
occurring  in  industries  bound  by  an  award  or  industrial  agreement.  A  more  stringent 
provision  is  made  in  regard  to  certain  special  industries  whose  sudden  cession  would 
cause  deaths  or  injury  to  the  health  of  the  community  in  general.  These  include  the- 
manufacture  or  supply  of  electricity,  coal  gas,  water,  milk,  meat,  coal,  and  the 
working  of  ferries,  tramways,  railways,  etc.  Persons  employed  in  such  service  must 
give  fourteen  days'  notice  of  intention  to  strike,  or  are  liable  to  summary  conviction 
before  a  magistrate  with  a  fine  not  exceeding  £25  ($121.25).  Persons  who  aid  or 
instigate  strikes  in  such  trade  are  liable  to  a  similar  fine,  and  in  the  case  of  unions 
up  to  £500  ($2,425).  An  employer  locking  out  in  such  special  trade  without  giving- 
a  month's  notice  to  his  employees  is  liable  to  summary  conviction  before  a  magistrate- 


NEW  ZEALAND.  105 

and  a  fine  not  exceeding-  £500  ($2,425),  a  fine  which  is  also  liable  to  be  inflicted 
on  any  union,  employer,  or  person  other  than  a  worker  aiding  or  abetting  a  lockout. 
An  industrial  union  or  association  abetting  an  unlawful  strike  of  any  of  its  members- 
may  on  conviction  have  its  certificate  of  registration  suspended  for  a  period  not 
exceeding  two  years.  The  court  has  power  to  limit  the  area  of  this  suspension,  but 
during  the  time  of  suspension  no  new  industrial  union  of  workers  may  be  registered 
in  the  same  industry  in  the  same  industrial  district. 

Such  definite  and  decisive  enactments  as  these  lay  down  certain  principles  as 
absolutely  necessary  for  the  further  usefulness  of  the  act.  There  was  in  the  act  in 
its  first  introduction  in  1894  no  bar  against  strikes  or  lockouts  unless  these  took 
place  while  inquiry  before  the  board  or  court  was  pending,  and  this  was  not  altered 
until  the  act  of  1905  made  a  strike  or  lockout  a  breach  of  award.  The  whole  sub- 
ject had  hitherto  been  in  a  hazy  or  nebulous  condition ;  no  one  exactly  knew  what  a 
strike  was,  when  it  began  or  when  it  ended ;  neither  was  there  any  consensus  of 
opinion  as  to  what  "aiding  or  abetting"  a  strike  meant.  We  have  in  the  new  act  at 
all  events  a  determined  effort  to  clear  the  ground,  and  set  the  issues  fairly,  not  only 
before  the  employer  and  employed,  but  before  the  general  public,  who,  as  "the  great 
third  party,"  generally  has  to  pay  the  reckoning  for  both  sides  in  industrial  quarrels. 

Ordinary  breaches  of  award  are  to  be  heard  before  stipendary  magistrates.  A 
magistrate  may  give  judgment  for  the  amount  claimed  or  for  more  or  less,  as  he 
thinks  fit ;  such  amount  becoming  a  penalty  paid  to  the  use  of  the  crown.  An 
appeal  is  allowed  to  the  court  of  arbitration.  No  person  can  be  imprisoned  for 
breach  of  award,  but  any  penalty  imposed  may  be  recovered  by  deduction  from  wages 
which  may  hereafter  become  due,  although  not  to  a  greater  amount  than  the  surplus 
above  two  pounds  ($9.70)  a  week,  if  the  debtor  is  married,  or  a  widower  or  widow 
with  children,  nor  to  a  greater  amount  than  the  surplus  above  one  pound  ($4.85) 
a  week  in  the  case  of  any  other  worker.  If  judgment  has  been  given  against  a 
union  or  other  association  and  is  not  satisfied  within  a  month  the  individual  workers 
are  liable  to  the  extent  of  £5  ($4.85)  each.  Inspectors  of  awards  can  move  a 
strike  or  lockout  case  (although  a  breach  of  award)  directly  to  the  arbitration 
court,  as  such  grave  matters  (with,  perhaps,  heavy  fines)  need  the  responsibility  of 
the  highest  court  obtainable. 

As  has  been  above  remarked,  the  present  act  has  suffered  through  want  of 
mobility,  and  through  being  overburdened  with  duties  caused  by  the  collapse  of 
other  portions  of  the  act.  Removing  the  hearing  of  ordinary  breaches  of  award 
into  the  stipendary  magistrate's  court  will  set  the  arbitration  court  more  free  to- 
hear  cases  of  industrial  dispute  at  once. 

Three  employers  (formerly  two)  may  form  an  industrial  union  of  employers  and 
fifteen  workmen  (formerly  seven)  may  form  an  industrial  union  of  workers.  The- 
voting  power  of  unions  in  nominating  members  of  the  arbitration  court  is  altered 
from  one  vote  to  each  union,  to  one  vote  for  each  fifty  members  of  a  union.  The 
court  may  amend  the  provisions  of  any  award  in  the  flax  industry  if  it  is  thought 
advisable,  and  if  circumstances  have  changed  since  the  award  was  made,  but  the- 
general  power  to  change  any  other  award  on  application  does  not  exist.  In  the  flax 
industry  the  court  must  satisfy  itself  that  the  wish  for  change  is  general  both 
among  employers  and  employed  before  it  grants  any  amendment.  Any  executive 
officer  of  a  workers'  union,  or  worker  who  has  sat  as  assessor  in  a  council  of 
conciliation,  or  has  represented  his  union  in  any  negotiations,  can,  if  dismissed  soon 
after,  throw  upon  the  employer  dismissing  him  the  weight  of  proof  necessary  to- 
show  that  his  dismissal  has  been  for  business  reasons  only,  and  not  through  any 
objection  to  him  as  a  unionist  or  assessor. 

A  worker  who  has  accepted  less  than  the  minimum  wage  awarded  in  the  industry- 
can  not  claim  the  difference  between  the  rate  received  and  the  award  rate  for  a 
longer  period  than  three  months.  The  age  limit  of  apprentice  is  to  be  left  to  the 
discretion  of  the  court  in  making  an  award.  Inspectors  of  awards  are  the  persons 
to  issue  permits  to  work  below  the  minimum  rate  mentioned  in  an  award,  but  must 
give  notice  as  at  present  to  the  secretary  of  that  particular  workers'  union,  so  that 
objection  may  be  made  if  necessary  to  the  permit  being  granted.  No  such  permit 


106  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

shall  be  given  to  any  one  not  usually  employed  in  that  industry,  e.  g.,  no  sailor  out 
of  work  can  do  carpentry  or  painting  of  a  trade  character. 

One  of  the  most  important  sections  of  the  new  act  is  that  which  restricts  the 
definition  of  the  word  "worker"  to  those  employed  for  the  direct  or  indirect  pecuniary 
gain  of  the  employer.  Thus,  a  market  gardener  is  a  worker,  but  a  private  gardener 
is  a  servant ;  the  housemaid  in  a  lodging-house  or  hotel  is  a  worker,  but  a  domestic 
servant  in  a  private  house  is  not. 

The  court  may  antedate  the  period  at  which  its  award  comes  into  force,  and  it 
may  also  refuse  to  make  an  award  at  all  if  it  thinks  fit.  This  latter  provision  gives 
legislative  sanction  to  a  course  the  arbitration  court  has  already  followed  in  one  or 
two  cases.  Jurisdiction  is  given  to  the  court  to  extend  an  industrial  agreement  to 
bind  a  dissenting  body  of  employers  if  the  employer  or  employers  who  employ  a 
majority  of  the  industry  consent  to  such  agreement.  After  an  award  or  industrial 
agreement  is  made  its  provisions  will  take  precedence  of  any  legislation  made  during 
its  currency  unless  the  contrary  is  directly  stated  in  the  act  so  passed ;  but  at  the 
expiration  of  the  time  for  which  the  award  or  agreement  was  made  the  provisions 
of  the  law  then  in  force  must  be  observed. 

A  very  large  proportion  of  the  account  thus  given  of  the  new  act  refers  to  abso- 
lutely new  and  original  modes  of  legislation  in  the  direction  of  conciliation  and 
arbitration.  They  prove  the  strong  attempt  of  the  government  to  reconcile  the 
liberty  of  the  individual  with  the  discipline  necessary  to  carry  on  the  industrial  and 
•commercial  life  of  the  community,  for  to  those  who  do  not  care  to  place  themselves 
under  the  arbitration  act  the  utmost  freedom  is  given,  whether  to  work  or  strike, 
but,  if  the  benefits  of  arbitration  are  appealed  for,  then  submission  to  the  ordinary 
rules  of  conduct  governing  those  who  have  claimed  its  privileges  must  control  also 
those  who  feel  its  disadvantages. 

The  following  clause  was  recently  introduced  by  the  arbitration  court 
of  New  Zealand  into  its  award  in  the  Southland  timber  workers' 
dispute : 

(a).  The  union  shall  do  all  in  its  power  to  prevent  any  strike  by  any 
of  the  workers  affected  by  the  award,  and  if  any  strike  shall  occur,  in 
which  any  member  of  the  union  shall  take  part,  such  strike  shall  be 
prima  facie  evidence  that  the  union  has  committed  a  breach  of  its  duty 
thereunder. 

(&).  If  any  strike  by  any  of  the  workers  affected  by  this  award  shall 
occur,  then  the  operation  of  all  the  provisions  contained  in  the  foregoing 
-clauses  of  this  award  shall  be  suspended,  and  in  lieu  thereof  the  following 
provisions  shall  come  into  force,  and  shall  remain  in  force  until  the  fur- 
ther order  of  the  court;  that  is  to  say,  the  hours  of  work,  wages,  and 
other  conditions  of  work  of  all  workers  coming  within  the  scope  of  this 
award  shall  be  fixed  by  agreement  between  each  employer  and  the  indi- 
vidual workers  employed  by  him. 

(c).  The  court  reserved  leave  to  any  party  bound  by  this  award  to 
apply  to  this  court  for  an  order  under  this  clause  declaring  that  a  strike 
has  taken  place,  or  bring  into  force  again,  after  a  strike  has  taken  place, 
the  provisions  contained  in  the  foregoing  clauses  of  this  award. 

Then  follows  this  very  important  memorandum  of  the  court : 

This  award  contains  a  new  provision  with  regard  to  strikes  which  the  court  has 
decided  to  bring  into  general  operation  in  future.  It  is  necessary  to  explain  the 
operation  of  this  new  provision.  If  a  strike  by  any  of  the  workers  affected  by  the 


NENV   ZEALAND.  107 

award  takes  place,  the  provisions  of  the  award  as  to  the  hours,  wages,  and  other 
conditions  will  cease  at  once  to  operate,  and  thenceforth  during  the  currency  of  the 
award  the  respective  rights  of  the  employers  and  workers  as  to  these  matters 
will  have  to  be  settled  by  agreements  between  the  respective  parties  themselves. 
In  other  words  the  workers  by  striking  will  deprive  themselves  of  the  benefits  (if 
any)  of  the  award,  and  incidentally  of  the  benefits  of  the  arbitration  act.  They 
will,  however,  during  the  currency  of  the  award  remain  subject  to  the  penal  pro- 
visions of  the  act  with  regard  to  strikes.  These  provisions  will  make  it  impossible 
for  an  award  to  be  treated  as  a  stepping-stone  merely  in  the  way  of  enforcing  the 
demands  of  the  workers.  If,  after  getting  an  award,  they  strike,  and  the  strike 
fails,  they  will  not  be  able  to  fall  back  on  the  award,  but  will  have  to  be  content 
with  whatever  terms  they  can  obtain  by  individual  bargaining  with  the  employers. 
The  court  has  reserved  power  to  itself  to  bring  into  operation  again  the  provisions 
of  the  award  after  a  strike  has  taken  place.  This  will  enable  the  court  to  obviate 
the  hardship  that  might  otherwise  result  when  a  small  section  of  the  workers 
affected  by  the  award  engage  in  a  strike  without  the  sanction  or  connivance  of  the 
union. 

ATTITUDE  OF  EMPLOYERS  AND  WORKERS  TO  LABOR  LEGISLATION. 

Prior  to  the  adoption  of  the  amendments  to  the  act  of  1908,  which 
went  into  effect  January  1st  of  this  year,  there  was  very  bitter  dissatis- 
faction on  the  part  of  employers  and  men  with  its  operations.  The  senti- 
ments expressed  and  the  resolutions  passed  alike  at  labor  conferences 
and  at  conferences  of  employers  were  unmistakably  against  the  admin- 
istration of  the  act.  Here  are  some  of  the  opinions  expressed  emphasiz- 
ing this  point. 

A  labor  department  official- 
Fifteen  years'  experience  has  shown  this  weakness  in  the  system.  Men  are 
governed  by  greed,  hate,  love,  and  passion  and  not  by  reason.  The  act  has  failed 
because  reason  does  not  prevail.  Labor  elected  as  conciliator  in  Wellington  an 
unsteady  hothead.  The  other  side  was  just  as  badly  represented.  Out  of  twenty- 
four  cases  twenty  were  appealed  to  the  arbitration  court  leading  to  dissatisfaction 
because  of  the  useless  work  of  the  conciliation  board  and  the  board  was  finally  cut 
out,  which  led  to  further  congestion  of  the  court  and  yet  more  greatly  emphasized 
the  consequent  delays.  The  workers  expected  too  much  of  the  idea,  especially  since 
during  the  first  ten  years  it  did  much  for  them  in  shortening  hours,  raising  wages, 
paying  for  holidays  and  often  the  law  gave  preferences  to  unionists.  But  it  could 
not  move  the  whole  economic  and  individual  interests. 

A  leading  editor- 
No  doubt  compulsory  arbitration  has  done  much  for  New  Zealand.     The  trouble 
has  been  in  its  administration. 

Labor  leader — 

We  want  the  act.  But  we  want  it  as  originally  conceived  by  the  framer,  with, 
of  course,  such  machinery  amendments  as  experience  has  shown  are  essential. 

A  building  contractor — 

The  weakness  of  the  act  has  not  been  so  much  its  principle  as  its  administration. 

Sentiments  of  a  labor  leader  at  a  labor  conference— 

The  workers  had  been  making  complaints  about  the  act  and  had  been  endeavoring 
by  every  legitimate  means  to  impress  upon  the  government  the  necessity  of  improve- 
ment in  the  machinery  of  the  act.  One  chief  grievance  was  in  the  delay  that 
occurred  in  the  hearing  of  the  disputes.  Year  after  they  had  been  promised  that 


108  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

this  should  be  remedied,  but  no  remedy  was  provided.  It  was  entirely  because  of  the- 
delays  of  the  court  that  the  slaughtermen  had  taken  the  drastic  steps  they  had  in 
striking  for  their  rights,  and  if  their  action  resulted  in  an  improved  act,  it  would 
prove  a  blessing  to  the  country. 

He  thought  himself  that  the  strike  instead  of  doing  what  it  was  alleged  it  would 
do,  that  was,  break  down  the  conciliation  and  arbitration  act  (if  the  lesson  was  to  be 
taught  by  a  strike)  instead  of  the  strike  meaning  and  causing  the  breakdown  of  the 
act,  it  was  going  to  be  the  saving  of  it.  The  legislature  would  then  recognize — and 
he  hoped  it  would — that  the  position  that  had  existed  for  the  past  eight  or  nine  years 
was  totally  unreasonable,  and  it  was  a  position  of  affairs  that  could  expect  no 
reasonable  body  of  individuals  to  accept.  He  knew  of  cases  where  unions  had  been 
brought  into  existence,  had  been  registered,  had  framed  their  claims,  had  cited 
their  case,  and  were  dead  and  buried  long  before  the  court  had  come  along  to  hear 
their  case.  *  *  *  It  was  totally  unreasonable  to  expect  men  to  wait  from  ten 
months  to  two  years  for  the  court  to  consider  their  cases. 

ATTITUDE  OF  EMPLOYERS  AND  MEN  ON  LABOR  LEGISLATION  IN  GENERAL. 

The  amendments  to  the  act  enacted  in  1908,  and  that  have  now  been 
in  force  since  the  beginning  of  this  year,  have  tended  to  modify  the 
hostility  toward  the  act.  Many  employers  and  men  felt  that  the  govern- 
ment was  earnestly  desiring  to  make  the  act  one  of  the  highest  useful- 
ness with  the  least  friction,  injury,  or  annoyance  to  either  side,  and 
numbers  on  both  sides  have  accordingly  shown  a  readiness  and  a  willing- 
ness to  give  it  hearty  support  and  a  fair  trial.  The  utterances  of  Presi- 
dent Hobbs  at  the  conference  of  employers  held  in  Christchurch  in  1908 
I  think  fairly  represent  the  attitude  of  many  New  Zealand  employers. 
He  said : 

Now  that  the  act  is  before  the  house  for  amendment  or  repeal  it  is  advisable  for 
us  as  employers  to  consider  whether  or  not  we  want  compulsory  arbitration.     The 
advantages  of  the  system  if  it  can  be  equally  enforced  are — 
For  the  worker: 

Prevention  of  sweating ; 

The  securing  of  a  fair  return  for  his  labor. 

For  the  employer : 

Security  of  contract ; 

Settled  working  conditions  for  a  stated  time ; 
Equality  of  working  conditions ; 

Security   to  the   fair-minded   employers,   by   prevention   of   undercutting   of 
prices  at  the  workers'  expense. 

Any  act  that  will  secure  these  conditions  must  be  beneficial  to  both  worker  and 
employer,  and  should  receive  our  support.  In  considering  this  question  we  have  also 
to  remember  that  even  if  no  act  dealing  with  industrial  disputes  is  on  the  statute 
book,  we  shall  not  have  freedom  of  action,  because  the  other  side  is  now  a  powerful 
force,  well  organized,  and  able., to  use  the  strike  weapon  as  it  never  has  before. 
Open  industrial  warfare  brings  heavy  losses  to  both  winner  and  loser.  I  have  for 
some  time  opposed  compulsory  arbitration  and  in  favor  of  a  measure  promoting 
voluntary  conciliation,  because  it  did  not  seem  possible  to  amend  the  law  so  as  to 
make  compulsion  effective  against  both  sides.  Equality  before  the  law  is  a  funda- 
mental principle  of  British  justice.  It  is  a  precious  heritage  which  we  can  no  longer 
allow  to  be  traduced.  The  government  has  fairly  faced  the  position,  and  brought 
down  a  method  of  enforcement  which  seems  to  have  some  claims  of  successful 
operation.  It  might  well  be  called  "The  last  try  compulsory  arbitration  bill." 
and  as  employers  I  think  it  would  be  in  the  best  interests,  both  of  ourselves  and  of 


NEW  ZEALAND.  109 

the  community  as  a  whole,  if  we  give  this  last  try  a  fair  trial.  If  it  fails,  the 
matter  will  be  definitely  settled.  On  the  other  hand,  if  this  method  is  not  tried 
there  will  always  be  a  feeling  that  the  failure  of  compulsory  arbitration  has  not 
been  proved,  and,  at  some  future  time  there  is  no  doubt  that  an  act  on  the  lines 
of  that  now  proposed  would  become  law,  and  the  whole  trouble  begun  over  again. 

The  attitude  of  many  among  the  workers  whom  I  interviewed  was 
likewise  to  the  effect  that  the  recent  amendments  would  largely  if  not 
entirely  overcome  some  of  the  most  serious  objections  to  the  administra- 
tion of  the  act,  that  the  new  machinery  provided  would  expedite  cases, 
and  obviate  the  distressing  delays  previously  incurred  by  the  men  in 
their  desire  to  obtain  peaceful  redress  for  grievances. 

This  does  not  mean,  however,  that  there  is  a  unanimity  of  feeling  in 
favor  of  labor  legislation  among  employers  and  workers  in  New 
Zealand.  The  feeling  more  especially  among  many  employers,  is  that 
such  legislation  has  on  the  whole  been  harmful  to  industry  and  has  in 
many  ways  brought  with  it  evils  not  before  experienced.  Here  are  some 
of  the  opinions  expressed  by  employers  and  secretaries  of  employers' 
associations  in  various  parts  of  the  dominion. 

A  leading  business  man— 

The  theory  of  compulsory  arbitration  is  good,  but  it  often  miscarries  and  becomes 
reduced  to  an  absurdity.  I  regard  it  as  a  failure  and  feel  morally  certain  that  in 
time  it  will  be  abandoned. 

Another  business  man— 

The  act  leads  to  friction  and  ill  will  between  employer  and  men. 

An  ironmaster— 

The  iron  industry  under  the  workings  of  the  act  is  not  profitable.  The  arbi- 
tration court  is  part  of  a  political  machine  gotten  up  for  the  benefit  of  the  workers. 
To  illustrate  this,  let  me  say  that  in  the  face  of  a  bad  showing  as  to  profits,  the 
court  raised  the  wages  of  the  men  ten  per  cent.  Moreover,  the  tendency  of  the  law 
is  to  make  for  a  lessened  efficiency  on  the  part  of  the  men. 

A  manager  of  meat  packing  company- 
it  makes  of  the  men  mere  machines. 

A  secretary  of  an  employers '  association— 

In  some  trades  employers  have  not  been  able  to  cope  with  the  extra  cost  of 
production  due  to  the  increased  wages  granted  by  the  court,  and  hence  have  been 
obliged  to  give  up  the  manufacturing  part  of  their  business  and  increase  their 
importations. 

The  minimum  wage  is  fixed  too  high  in  the  majority  of  cases  with  the  result  that 
the  employer  often  makes  no  distinction  among  the  various  grades  of  his  workmen  as 
regards  rate  of  pay.  This  tends  to  reduce  efficiency  and  takes  away  from  the 
capable  man  any  ambition  he  may  have.  The  relation  between  employers  and  their 
men  have  been  less  cordial  than  they  were  previous  to  the  operation  of  the  act. 
In  the  majority  of  cases  both  sides  occupy  hostile  camps.  Some  employers  are 
harassed  by  what  may  be  called  "vexatious  legislation." 

Hardly  any  new  industry  has  been  started  for  some  years  and  this  notwith- 
standing that  the  conditions  of  the  dominion  have  been  eminently  favorable  for 
industrial  enterprises.  It  is  an  undisputed  fact  that  people  having  money  to  invest 
-have  carefully  avoided  any  concern  in  which  labor  is  the  chief  item  of  expenditure. 


110  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

A  master  baker- 
Compulsory   arbitration   is   a   lot  of   rot.      It   did   not   prevent   the   journeymen 
bakers  here  in  Wellington  from  going  on  a  strike. 

An  ironmaster — 

Our  increased  imports  are  due  to  the  labor  laws.  The  act  leads  to  a  diminishing 
output  and  makes  for  a  dead  level. 

A  college  professor- 
Reduction   in  wages  in  hard   times,   even   when   prices   come   down,    will   cause 
enough  strikes  to  smash  the  system. 

A  mine  owner — 

What  is  to  become  of  our  industries  in  bad  times  when  we  have  to  pay  a  wage 
fixed  by  the  court  higher  than  the  industry  can  stand? 

A  secretary  of  an  employers'  association— 

The  result  on  trade  of  thirteen  years'  working  of  the  act  is  that  it  has  not  been 
advantageous.  In  many  trades  it  has  opened  the  door  to  importations,  owing  to 
the  increased  cost  of  production,  preventing  the  local  industries  from  competing  with 
the  open  market.  It  is  not  advantageous  to  the  community  owing  to  the  increased 
cost  of  living,  both  in  rents  and  commodities,  resulting  from  its  operations. 

Speaking  generally,  therefore,  the  New  Zealand  Employers'  Federation  does  not 
think  the  industrial  conciliation  and  arbitration  act  has  proved  beneficial  to  worker, 
employer  or  consumer. 

A  manufacturer  of  tinware — 

It  makes  the  men  too  damned  independent.  There  are  many  annoyances  to  the 
employer  connected  with  the  act.  It  can  not  prevent  strikes.  Although  employers 
do  not  try  to  evade  awards,  it  needs  a  lawyer  not  to  miss  some  of  the  provisions 
and  avoid  getting  into  the  clutches  of  the  court. 

A  building  contractor- 
Believe  it  would  be  better  if  labor  laws  and  labor  unions  were  abolished.     The 
act  is  responsible  for  higher  cost  of  living  and  for  higher  wages. 

A  secretary  of  contractors '  association— 

We  were  to  sacrifice  freedom  for  industrial  peace  under  the  act.  Now  we  find 
we  have  sacrificed  both. 

A  clothing  manufacturer — 

The  chief  objection  I  see  to  the  act  is  the  annoyance  likely  to  come  from  the 
government  inspectors. 

A  manager  of  a  meat  works— 

The  chief  objections  to  the  act  are  the  hours  established,  the  preference  to 
unionists,  and  the  petty  annoyances  to  which  employers  are  subjected. 

A  master  plumber— 

The  preference  to  unionists  clause  is  a  thorn  in  the  side  of  employers. 

A  secretary  of  an  employers '  association- 
Employers  consider  the  act  a  hindrance  because, 

(a)   It  makes  for  the  dead  level  among  workers. 

(ft)   It  limits  apprentices. 

(c)  It  checks  industrial  expansion. 

(d)  It  destroys  friendly  relations  between  employers  and  men. 

(e)  It  has  raised  the  cost  of  living. 

(f)  It  has  abnormally  raised  wages. 


NEW  ZEALAND.  Ill 

An  ironmaster- 
Feels  that  employers'  candle  is  burning  at  both  ends.     Higher  wages  and  lower 

efficiency  prevails  because  of  the  act.     The  greatest  grievance  is  that  most  of  the 

disputes  are  artificial  and  manufactured. 

An  ironmaster— 

Instead  of  being  a  court  of  reference  in  case  of  dispute  or  misunderstanding  likely 
to  result  from  a  strike  or  lockout,  to  the  detriment  or  loss  of  a  community,  the  court 
of  arbitration  has  become,  under  the  pressure  of  unionist  importunity,  a  court  for 
the  state  regulation  of  industries. 

A  leading  employer— 

The  court  has  been  used  not  as  a  preventive  or  cure,  but  as  a  convenient  substitute 
for  strikes,  as  an  instrument  for  giving  form  and  substance  to  ambitions,  which,  in. 
its  absence,  would  probably  not  have  developed  into  disagreements,  and  almost 
certainly  would  never  have  culminated  into  serious  disputes.  The  result  is  that  at 
the  first  real  trial  the  system  has,  judged  by  its  original  intention,  broken  down.  The 
court  can  punish  a  man  for  striking,  but  it  can  not  persuade  him  to  work  on  terms 
which  are  distasteful  to  him.  On  the  other  hand,  it  may  punish  an  employer  for 
locking  out  his  men,  but  it  can  not  make  him  reopen  and  run  his  factory  at  a  loss. 

A  lawyer— 

If  there  is  a  lesson  to  be  learned  by  other  countries  from  the  experience  of  Xi-w 
Zealand,  it  is  this  :  That,  if  they  want  a  system  of  arbitration  for  the  settlement 
of  strikes  and  real  disputes  rather  than  one  for  the  creation  and  multiplication  of 
factitious  disputes,  they  should  adopt  some  such  system  as  that  of  Massachusetts. 
It  has  been  said  that  labor  passes  through  three  stages — when  it  is  enslaved,  when 
it  is  free,  and  when  it  is  tyrannical.  In  New  Zealand  it  has  reached  the  third  stage. 

A  secretary  of  an  employers '  association— 

To  my  mind  there  are  five  unmistakable  defects  which  have  largely  contributed 
to  the  failure  of  the  act  to.  bring  about  the  desired  results : 

(1)  The  act  has  been  jeopardized  by  its  going  beyond  wages  and  hours  of  work. 

(2)  In  making  it  far  too  easy  for  the  unions  to  bring  cases  before  the  court. 

(3)  The  fixing  of  a  standard  instead  of  a  minimum  wage. 

(4)  The   holding   of   individual   workers    and   unions,    in   place   of   unions   only,, 
responsible  for  strikes. 

(5)  The  too  frequent  changes  of  the  judges. 

*  *  *  (The  act)  has  been  a  real  hindrance  in  that  it  has  greatly  increased  the 
cost  of  production.  The  history  of  the  colony  during  the  past  few  years  has  been 
increased  importation  and  an  almost  stationary  local  output. 

It  (the  act)  has  created  strife,  manufactured  disputes,  impaired  the  work, 
restricted  the  output,  increased  the  cost  of  production,  put  up  the  cost  of  living  to 
such  an  extent  that  a  pound  to-day  goes  no  further  than  did  sixteen  shillings  in 
1894.  *  *  *  The  latest  statistics  show  the  increase  in  wages  to  be  from  eight  and 
one  half  per  cent  to  ten  per  cent,  the  increased  cost  of  living  from  twenty-five  to 
thirty  per  cent. 

A  secretary  of  an  employers'  association— 

If  the  industries  of  the  country  are  to  progress  as  they  ought  to  they  must  not  be 
hampered  by  labor  legislation.  I  am  of  the  opinion,  after  a  careful  study  of  the 
labor  matters  here  for  nine  years,  that  the  arbitration  act  has  hindered,  and  is  still 
hindering,  the  industrial  progress  of  the  country. 


112  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

EMPLOYERS  AND  OTHERS  WHO  FAVOR  THE  ACT. 

It  must  not  be  presumed  from  the  foregoing  unfavorable  and  more  or 
less  hostile  opinions  on  the  part  of  employers  and  others  toward  the  act 
that  it  has  no  friends.  Here  are  the  opinions  of  some  who  speak  well  of 
it  and  their  reasons  why  they  do : 

A  building  contractor— 

The  act  has  weeded  out  sweating  employers.  So  far  as  the  building  trades  are 
concerned  it  has  not  affected  its  progress  one  way  or  the  other. 

A  manager  of  a  teaming  company- 
It  has  helped  the  dominion  because  the  act  has  made  for  a  high  degree  of  industrial 
peace. 

A  clothing  manufacturer- 
It  has  made  no  difference  in  the  clothing  trade  beyond  driving  out  the  sweater 
and  in  doing  this  it  has  rendered  very  valuable  service.  Last  year  a  manufacturer 
was  caught  sweating  and  was  driven  out  of  the  trade  through  the  operations  of  the 
law.  Had  it  not  been  for  the  law,  in  all  probability,  he  would  by  his  sweating 
methods  and  at  the  expense  of  labor  have  driven  fair  employers  out  of  the  trade. 

A  shoe  manufacturer— 

The  law  makes  for  steadiness  of  wages.  I  could  not  have  fulfilled  my  government 
•contracts  for  the  Boer  war,  for  example,  if  it  had  not  been  for  the  awards  fixing  a 
wage  for  a  fixed  period. 

Another  shoe  manufacturer— 

The  act  has  been  a  great  advantage  in  making  for  industrial  peace. 

A  publisher- 
Finds  the  act  advantageous  in  his  business.     It  has  in  his  opinion  been  of  great 
advantage  to  the  dominion.     It  has  cut  out  sweating,  raised  the  conditions  surround- 
ing the  worker  and  has  cut  out  payment  exacted  by  employers  for  teaching  apprentices 
their  trade. 

Director  in  street  railway  company- 
Blames  agitators  for  troubled  labor  conditions.     On   the  whole,   labor  situation 

better  than   in   England.      Considers   the  whole  system  under  the  legislation  much 

better  than  strikes. 

A  waterside  worker— 

The  hours  of  labor  have  been  shortened  under  the  act,  half  holidays  have  been 
-obtained,  sweating  has  been  minimized,  and  the  lot  of  the  men  has  been  generally 
improved,  owing  to  the  industrial  legislation. 

A  labor  member  of  Parliament- 
Two  thirds  of  the  men  are  in  favor  of  the  act.     The  attitude  of  labor  generally  is 
that  the  new  amendments  should  have  a  fair  trial. 

A  public  official— 

A  few  agitators  try  to  make  themselves  prominent  by  railing  at  the  act  but  they 
would  abuse  any  measure  that  had  become  law.  They  are  "agin"  the  government 
always.  The  steady,  silent  vast  majority  of  labor  favors  the  act. 

A  contractor 's  foreman— 

Under  the  old  conditions  men  could  be  sweated ;  under  the  act  men  can  not  be 
sweated.  It  has  had  a  tendency  to  level  down  the  good  worker  to  the  poorer  worker. 
Despite  this  the  general  efficiency  of  the  worker  is  not  lower  than  before  because 
sweating  in  itself  tended  to  diminish  efficiency. 


NEW  ZEALAND.  113 

The  president  of  a  labor  union — 

If  the  act  were  put  to  a  referendum  of  workers,  ninety  per  cent  would  vote  for 
its  retention.  It  has  given  them  fourteen  years  of  comparative  industrial  p«ace  at 
fair  wages  and  under  good  conditions.  When,  in  their  minds,  they  compare  all  this 
with  the  conditions  that  prevail  in  countries  where  strikes  are  resorted  to,  and 
realize  the  great  amount  of  loss  and  suffering  that  strikes  inflict  on  labor  and  its 
dependents,  they  more  keenly  appreciate  the  blessings  they  enjoy  under  a  system 
which  enables  them  to  have  all  their  grievances  settled  peaceably. 

An  ironmaster— 

The  value  of  the  law  is  that  it  prevents  sweating. 

A  wholesale  dry  goods  merchant- 
Much  prefer  the  act  to  strikes. 

Manager  of  steamship  company- 
Is  a  strong  believer  in  the  value  of  the  act  if  it  is  not  abused. 

Lumber  merchant- 
Would  not  be  in  favor  of  repealing  any  part  of  the  act. 

A  sawmill  owner- 
Labor  legislation  of  some  sort  is  in  his  opinion  absolutely  necessary.     The  act 
prevents  sweating  and  is  advantageous  to  fair  employers. 

Shoe  manufacturer— 

The  relations  between  employer  and  employee  have  improved  under  the  act. 
There  is  not  the  continual  temptation  for  the  employer  to  cut  down  wages  in  order 
to  undersell  his  competitor. 

Sentiments  uttered  at  an  employers'  conference— 

In  some  respects  the  act  is  admirable.  It  gives  &  measure  of  assurance  of  settled 
conditions,  and  though  this  is  finally  dependent  upon  the  loyalty  and  consent  of  both 
parties,  it  is  no  small  gain.  In  so  far  as  it  has  been  effective  in  preserving  industrial 
peace,,  as  well  as  securing  justice  to  the  disputants,  the  act  may  be  said  to  have 
justified  its  existence. 

Dr.  Findlay,  attorney  general  of  New  Zealand— 

The  act  has  been  educative  of  public  sentiment.  New  Zealand  has  impressed 
obligations  on  both  sides.  The  great  body  of  workers  are  impressed  with  loyalty 

§the  court. 
Ex-Labor  member  of  Parliament— 
The  act  cuts  out  the  sweater,  makes  for  steadiness  of  wage,  and  tends  to  estab- 

fhing  industrial  peace.     The  result  of  the  recently  inflicted  penalties  on  strikers 
s  made  a  repetition  of  strikes  highly  improbable. 
An  architect— 

The  act  is  advantageous  to  employers  and  to  the  men.     Believe  that  on  the  whole 
th  favor  it. 


b° 


Factory  inspector— 
I  find  that  the  majority  of  employers  and  their  men  prefer  the  act  rather  than 
strikes. 

• 

Mine  manager- 
Believes  that  the  majority  of  the  men  favor  the  act. 

President  of  a  labor  council- 
Hard  times  will  show  the  men  the  value  of  the  act,  by  protecting  them  from  cuts 
in  wages  likely  to  follow  an  open  labor  market. 

8 


114  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

WAGES. 

In  common  with  the  conditions  prevailing  in  the  rest  of  the  industrial 
world  wages  in  recent  years  have  advanced  in  New  Zealand.  The  rate 
of  advance,  however,  has  not  been  uniform.  The  greater  advances  have 
taken  place  in  what  has  been  known  as  the  sweated  industries,  chiefly 
the  textile  industries.  Secretary  Tregear  of  the  Labor  Department 
was  good  enough  to  furnish  me  with  a  copy  of  data  prepared  by  his 
department  for  the  attorney  general,  which  I  herewith  append,  and 
which  will  show  the  change  in  wages  and  conditions  in  these  particular 
industries  since  the  introduction  of  the  act.  I  am  of  the  opinion  that  in 
these  branches  wages  through  the  operations  of  the  act  have  increased 
more  than  they  would  have  increased  if  left  to  the  operation  of  the  law 
of  supply  and  demand,  due  to  the  fact  that  the  workers  are  chiefly  unor- 
ganized women  and  children. 

DEPARTMENT  OF  LABOR,  WELLINGTOX.  May  19,  190s. 
Memorandum  for  The  Honorable,  the  Attorney  General: 

I  have  the  honor  to  submit  herewith  a  statement  in  regard  to  the  rates  of  wages 
paid  in  1890  and  those  paid  to-day  to  various  classes  of  workers.  The  information 
in  regard  to  the  early  period  is  taken  from  the  report  of  the  Sweating  Commission 
which  sat  throughout  New  Zealand  in  1890.  From  the  evidence  I  have  compiled 
the  following  statement : 

Trade.                                                  1890  (per  week).  1908  (per  week). 

Tailoresses  Os.  to  15s.  ($3.60).  5s.  ($1.20)  to  25s.  ($6.00> 

Hosiery   workers   5s.  ($1.20)  to  9s.  ($2.16).  7s.  ($1.68)  to  20s.  ($4.84  > 

Shirt   making   _ Os.  to  ISs.  6d.  ($4.44).  12s.  ($2.88)  to  30s.  ($7.20  i 

Average  wage 10s.  ($2.40)  to  12s.  ($2.88). 

Dressmaking    Os.  to  25s.  ($6.00).  5s.  ($1.20)  to  30s.  ($7.20  i 

Millinery  Average  wage  12s.  6d.  ($3.00).  5s.  ($1.20)  to  25s.  ($6.00  i 

The  commission  found  that  work  used  to  be  taken  home  by  workers  who  wished 
to  make  a  few  extra  shillings.  This,  as  you  know,  has  now  been  stopped ;  all  work 
having  to  be  done  on  the  employer's  own  premises. 

Apprentices  used  to  be  taken  on  at  the  above  trades  at  nothing  for  a  year,  and 
then  either  given  2s.  6d.  (60c. )  per  week  or  dismissed.  Now  no  apprentice  can  be 
taken  on  unless  they  are  paid  not  less  than  5s.  ($1.20)  per  week,  with  an  annual 
increase  of  3s.  (72c. )  per  week  up  to  the  age  of  twenty.  Should  an  apprentice  wish 
to  go  to  another  employer  the  time  served  with  the  previous  employer  must  count 
in  computing  the  wage. 

Formerly  employees'  hours  were  not  restricted  in  any  way ;  now  the  hours  are 
regulated,  and  only  a  limited  amount  of  overtime  is  allowed  in  a  year,  and  this 
extra  work  must  be  paid  for  at  special  rates. 

Employers  were  able  to  make  their  employees  work  in  any  sort  of  room,  with 
or  without  any  kind  of  convenience.  Now  they  must  provide  well  lighted  and 
ventilated  rooms,  ample  air  space,  special  dining-room,  and  proper  sanitary  accom- 
modation. 

In  1890  a  boy  or  girl  of  twelve  could  be  employed  in  a  factory.  The  age  has 
been  raised  to  fourteen,  and  no  boy  or  girl  under  sixteen  can  be  employed  in  any 
factory  without  having  passed  the  fourth  standard  of  education,  and,  further, 
without  a  certificate  of  fitness  from  the  inspector. 

Holidays  on  full  pay  were  not  provided ;  now  a  certain  number  of  days  are  set 
aside. 


NEW  ZEALAND.  115 

The  following  further  information  gleaned  from  the  sweating  commission's  report 
may  be  of  interest:  Boot  machinists,  sewing  uppers,  were  paid  from  12s.  ($2.S2) 
to  25s.  ($6.00)  per  week.  These  workers'  rates  are  now  fixed  by  an  award  of  the 
arbitration  court,  and  they  receive  a  minimum  of  25s.  ($0.00)  per  week. 

Young  women  milliners  were  made  on  Saturdays  to  serve  as  shop  assistants  until 
nearly  midnight. 

Hairdressers  worked  from  S  a.  m.  to  9.30  p.  m.,  and  on  Saturdays  till  midnight. 

Women  assistants  in  fancy  goods  and  book  shops  worked  from  9  a.  m.  till  6  one 
night  and  9  the  next,  and  received  from  10s.  ($2.40)  to  30s.  ($7.20)  per  week. 
(Braithwaite,  bookseller,  Dunedin  (545),  said  he  had  five  men,  two  boys  and  eight 
women,  and  admitted  he  had  no  lavatories.) 

Drapers'  assistants  were  not  allowed  to  sit  down.  The  present  act  provides  for 
sitting  accommodation  for  all  assistants.  In  the  dressmaking  trade  the  hours  were 
from  9  a.  m.  to  6  p.  m.,  including  Saturdays.  Apprentices  were  paid  nothing  to  9s. 
($2.1<>)  per  week,  and  adult  women  from  10s.  ($2.40)  to  15s.  ($:UK)).  Only  best 
hands  received  25s.  ($6.00).  Now  head  dressmakers  receive  from  £2  ($9.60)  to  £8 
($38.40)  per  week,  while  young  women  in  charge  of  rooms  average  about  £2  10s. 
($12.00)  per  week.  Very  few  adult  workers  receive  less  than  30s.  ($7.20)  per  week. 

In  confectioners'  shops  women  assistants  worked  from  8  a.  m.  to  10  p.  m. 
always,  and  up  to  11.30  p.  m.  on  Saturdays,  and  received  from  10s.  ($2.40)  to 
14s.  ($3.36)  per  week. 

Boys  engaged  in  milking  began  work  at  3.30  a.  m.  and  after  milking  delivered 
the  milk  in  the  city.  They  either  went  to  school  or  work  until  the  afternoon,  and 
were  engaged  again  at  milking  and  work  until  7  p.  m. 

Dr.  Martin  found  the  girls  in  factories  were  suffering  from  anemia  through  bad 
ventilation,  and  also  from  varicose  veins.  Dr.  Lamb  made  a  similar  statement, 
stating  that  it  was  due  to  the  bad  ventilation  and  vitiated  air  in  factories.  Girls 
were  found  to  be  working  heavy  sewing  machines  with  their  feet  hour  after  hour, 
and  he  considered  this  very  injurious  to  their  health.  Dr.  Stenhouse  also  reported 
that  anemia  was  very  common,  and  in  Dunedin  its  frequency  was  something 
extraordinary. 

I  attach  a  copy  of  the  sweated  commission's  report  for  your  information.  The 
number  quoted  in  the  margin  refers  to  the  number  of  question  in  the  commission's 
report. 

ED.  TREGEAB,  Secretary  for  Labor. 

In  a  pamphlet  published  by  the  New  Zealand  Labor  Department  in 
L907,  in  connection  with  an  exhibit  made  at  a  dominion  exposition,  the 
allowing  in  relation  to  wages  appears : 

Wages  in  Hours  in  Wages  in 

the  United  the  United  in  New  Hours 

States  States  Zealand  in  New 

per  hour.  per  week.  per  hour.  Zealand. 

Blacksmiths   30c  55  34c  46 

Boilermakers  28c  55  30c  48 

Carpenters    34c  48  32c  45 

Plumbers   - 44c  48  32c  46 

Painters    34c  48  30c  45 

Laborers    — 9c  55  24c  50 

Bricklayers   - 54c  46  38c  45 

Builders'  laborers  28c  48  26c  45 

The  foregoing  figures  show  that  the  average  weekly  earnings  in  these 
eight  industries  in  the  United  States  is  $16.50  and  in  New  Zealand 
$14.17. 


116  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

The  American  worker  earns  sixteen  per  cent  more,  but  works  about 
nine  per  cent  longer  hours.  For  the  same  number  of  hours  the  average 
American  earnings  is  a  fraction  over  six  per  cent  greater.  The  average 
New  Zealand  weekly  wage  for  the  unskilled  worker  from  figures  fur- 
nished by  the  labor  department  is  48s.  ($11.52)  and  for  skilled  labor  60s. 
($14.40)  per  week.  According  to  a  statement  attributed  to  Attorney 
General  Findlay,  the  average  wage  for  all  labor,  male  and  female  in  New 
Zealand,  is  $8.64  per  week. 

The  New  Zealand  Yearbook  for  1908  furnishes  the  following  figures : 

Average  Average                          Average 

annual  wage  annual  production                labor  cost 

per  worker.  per  worker.  on  production. 

1900 £69    6s.  ($337.09)  £364  ($1,766)  18.55  per  cent. 

1905 £65  16s.  ($310.09)  £346  ($1,675)  19.04  per  cent. 

The  past  several  years  up  to  1908  have  been  phenomenally  prosperous 
for  all  agricultural  and  pastoral  New  Zealand  producers.  In  conse- 
quence, farm  wages  during  that  period  owing  to  scarcity  of  labor  has 
advanced  far  more  than  wages  in  other  industries.  This  is  shown  by  the 
figures  found  in  the  New  Zealand  Yearbooks  for  1895  and  1907,  pages 
164  and  505,  respectively.  The  average  increase  in  wages  in  industrial 
undertakings  working  under  awards  from  1894  to  1906  was  19.7  per 
cent.  The  wage  increase  to  workers  in  agricultural  and  pastoral  pur- 
suits for  the  corresponding  period  is  29.3  per  cent.  This  looks  abnormal 
until  we  remember  that  in  Italy  within  the  past  few  years,  due  partly 
to  scarcity  of  farm  laborers  as  the  result  of  immigration  and  partly  to 
the  increased  cost  of  farm  products  and  living,  the  wages  of  farm  labor 
has  advanced  from  thirteen  cents  a  day  to  sixty-five  cents  a  day,  or 
about  five  hundred  per  cent. 

The  wonder  is  not  that  wages  in  New  Zealand  have  advanced  in  recent 
years.  When  the  advance  in  wages  the  world  over  is  considered  and  the 
increased  demand  for  all  sorts  of  labor  in  New  Zealand  during  the  pros- 
perous years,  in  industry,  in  agriculture  and  in  great  New  Zealand 
public  works  absorbing  many  thousands  of  workers  is  borne  in  mind, 
the  wonder  is  that  the  advance  in  wages  has  not  been  greater. 

COST  OP  LIVING. 

Three  causes  have  contributed  to  an  increased  cost  of  living  in  New 
Zealand  as  elsewhere  in  the  world— 

(a)   Higher  land  values,  especially  in  city  lots; 

( 1} )   The  world  increase  in  the  price  of  staples ; 

(c)  Higher  wages. 

The  increased  wage  cost  to  my  mind  has  been  the  smallest  contributing 
factor.  As  shown  by  the  foregoing  figures,  the  labor  cost  in  New 
Zealand  production  is  less  than  twenty  per  cent  of  the  gross  cost. 


NEW  ZEALAND.  117 

Assuming  that  wages  have  advanced  twenty  per  cent  this  would  add 
but  four  per  cent  to  the  gross  cost,  whereas  rents  and  the  price  of  world 
staples  have  increased  out  of  all  proportion  to  the  advance  in  wages. 
I  was  informed  by  reliable  authorities  that  city  lots  in  the  leading  New 
Zealand  cities  had  increased  in  value  in  the  last  ten  years  fully  two  hun- 
dred per  cent,  thus  very  greatly  increasing  rents. 

The  most  available  figures  on  the  relative  increase  in  New  Zealand 
wages  and  cost  of  living  are  to  be  found  in  an  address  delivered  by 
Attorney  General  Findlay  in  1908  in  which  he  says:  "At  Wanganui 
I  quoted  a  report  from  the  registrar  general,  which  showed  that  in 
twelve  years  since  the  act  passed  the  cost  of  living  for  workers  based 
on  the  chief  articles  of  diet  had  increased  18.6  per  cent  while  the  general 
increase  of  wages  affected  by  the  act  in  the  same  period  was  17.9  per 
cent.  This  report  did  not  include  rent  or  clothing,  and  it  is  admitted 
that  if  these  items  had  been  included  the  increase  in  the  cost  of  living 
would  have  been  greater.  Probably  the  increase  has  not  been  less 
throughout  New  Zealand  than  twenty  per  cent. ' ' 

RELATIONS  EXISTING  BETWEEN  EMPLOYERS  AND  THEIR  MEN. 

There  is  a  pronounced  conflict  of  opinion  as  to  the  effect  the  act  has 
had  upon  the  relations  existing  between  employers  and  their  men.  Here 
are  some  of  the  opinions  expressed  pro  and  con : 

Justice  Chapman,  formerly  president  of  the  arbitration  court— 
The  labor  laws,  in  my  opinion,  do  not  create  ill-feeling  between  employers  and 
their  men. 

A  timberman— 

The  feeling  between  employers  and  men  is  better  now  than  ever  before. 

Labor  leader  in  seamen 's  union— 

The  labor  laws  have  made  for  a  better  feeling  between  employers  and  their  men. 

Labor  member  of  Parliament— 

The  feeling  between  employers  and  their  men  is  much  the  same  as  before  the 
creation  of  the  act. 

The  report  of  the  executive  committee  of  the  trades  and  labor  council, 
1907- 

Taken  as  a  whole  our  relationship  with  our  employers  has  been  of  an  amicable 
nature.  One  of  the  exceptions  may  be  cited  as  the  recent  slaughtermen's  strike. 
While  we  may  sympathize  with  the  men  in  their  efforts  to  secure  increased  pay  and 
better  conditions,  your  executive  committee  can  not  help  expressing  its  regret  at 
their  hasty  and  ill-advised  action  in  ignoring  the  remedy  provided  by  the  industrial 
conciliation  and  arbitration  act.  We  are  satisfied,  however,  that  this  cloud  that  at 
one  time  threatened  to  spread  over  the  whole  industrial  horizon  of  the  colony  has 
been  dispersed  and  that  the  men  by  their  ready  compliance  with  the  verdict  of  the 
court  are  showing  that  the  powers  of  the  court  are  as  potent  to-day  as  ever  they  were. 


118  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

As  against  these  favorable  opinions  there  are  others  radically  opposite, 
which  herewith  follow : 

Mr.  George  T.  Booth  of  Christehurch,  an  ironmaster,  in  his  testimony 
before  the  legislative  committee— 

Q.  What  is  your  experience  with  regard  to  the  effect  of  our  labor  laws?  Have 
they  promoted  a  good  feeling  between  employer  and  employee  during  the  time  they 
have  been  in  operation? 

A.  I  believe  they  have  had  the  reverse  effect. 

Q.  But  do  you  not  think  that  the  relations  between  employer  and  employee  have 
been  improved  by  the  labor  legislation? 

A.  No,  I  think  it  has  had  the  opposite  effect. 

Secretary  of  builders'  association- 
Employers  in  the  building  trades  say  that  a  serious  result  of  the  act  is  to  destroy 

any  prior  existing-  sympathetic  bond  between  them  and  their  men  and  that  the  gap 

is  widening. 

A  master  cabinetmaker— 

The  labor  laws  lead  to  antagonisms  between  employers  and  their  men. 

Mr.  Tregear,  the  labor  secretary,  in  this  connection  said  that,  "in 
spite  of  assertions  made  by  extremists  on  both  sides,  the  relation  between 
employers  and  men  are  as  good  as  they  can  ever  be  under  the  wage 
system."  He  pointed  out  that  there  was  friction  about  a  year  ago. 
but  that  the  alteration  in  the  arbitration  act  last  session  of  Parliament 
had  smoothed  away  the  trouble. 

This  is  a  point  upon  which  it  is  not  possible  to  do  more  than  to  get 
opinions.  My  own  opinion  is  that  there  is  less  friction  and  a  more  cor- 
dial feeling  on  the  whole  here  between  employers  and  employed  than  I 
have  found  in  countries  where  strikes  and  lockouts  prevail. 

LABOR  UNIONISM. 

The  New  Zealand  Yearbook  for  1908  gives  the  number  of  industrial 
workers  under  date  of  April,  1906,  as  56,359.  The  same  authority, 
page  519,  gives  the  membership  of  workers'  unions,  not  including  nine 
who  failed  to  send  in  their  returns,  as  45,614.  In  1895,  when  the  act 
went  into  operation,  there  were  9,370  union  members.  In  most  countries 
in  Europe  the  number  of  organized  workers  will  not  average  twenty-five 
per  cent  of  the  entire  body  of  wage-earners.  Owing  to  the  fact  that  the 
Yearbook  quoted  "gives  the  number  employed  industrially  as  under  date 
of  April,  1906,  and  the  number  of  union  workers  as  under  date  of 
December,  1907,  it  is  not  possible  to  get  at  the  exact  proportion  of  union 
workers.  Approximately  it  is  safe  to  assume  that  the  union  workers 
represent  seventy-five  per  cent  of  the  whole,  which  is  far  ahead  of  the 
proportion  to  be  found  in  Europe  or  America.  It  would  indicate  that 
the  act  has  certainly  made  for  unionism. 

A  Labor  member  of  Parliament,  in  speaking  of  the  influence  of  the  act 


NEW  ZEALAND. 


119 


on  unionism,  says :  ' '  The  well  organized  unions  are  not  so  active  as  they 
\\cre  before  the  act  was  passed,  but  there  are  more  large  unions." 

A  government  labor  department  official  in  this  connection  says: 
•  •  Some  say  that  the  unions  have  lost  their '  fighting  spirit. '  I  do  not  know 
if  that  is  a  serious  loss.  It  is  not  necessary  to  swagger  round  with  a 
belt  full  of  revolvers  if  the  policeman  does  his  work  properly.  Our  law 
is  the  policeman,  and  so  perhaps  the  unions  get  'soft' — get  like  you  and 
me  compared  with  a  cowboy  of  the  'wild  and  woolly  west.'  If  by  'well 
off '  you  mean  '  financially, '  when  the  arbitration  act  passed,  the  unions 
had  nothing  at  all;  they  were  broken,  flaccid,  and  penniless  after  the 
great  maritime  strike  in  1891.  Now  some  of  them  have  £800  or  £1,000 
each — no  great  sum,  but  then  they  are  only  'industrial  unions';  they 
have  no  trade  union  purposes — the  act  fights  for  them,  so,  except  to  pay 
a  secretary,  expenses  are  nil,  and  the  funds  grow. ' ' 

As  was  stated  by  one  of  my  informants,  the  preference  to  unionists' 
clause  in  most  of  the  awards  of  the  arbitration  court  is  a  thorn  in  the  side 
of  most  employers.  Under  the  law  an  employer  needing  a  hand  must 
first  of  all  refer  to  the  register  kept  by  the  union  secretary,  and  if  there 
are  applicants  on  the  list  he  must  give  such  a  preference  over  non- 
unionists,  subject  in  the  event  of  failing  to  do  this  to  being  penalized 
by  the  court.  This  is  looked  upon  by  employers  generally  as  a  source  of 
annoyance  and  a  hardship.  The  workers,  however,  claim  that  since  the 
law  takes  from  them  the  legal  right  to  strike,  they  are  entitled  to  some 
consideration  in  return.  The  following  copy  of  a  preference  clause  as  it 
appears  in  the  award  made  by  the  arbitration  court  for  the  Wellington 
wharf  laborers  indicates  the  attitude  of  the  court  on  this  vexed  point. 


11\S 

pe 
w. 


(Award  of  the  arbitration  court  for  Wellington  wharf  laborers.     Extracts,  pp.  6-7-8.) 

Preference. — If  and  so  long  as  the  rules  of  the  union  shall  permit  any  person  of 
good  character  to  become  a  member  of  the  union  upon  payment  of  an  entrance  fee 
not  exceeding  2s.  Gd.  (60c),  and  of  subsequent  contributions  not  exceeding  (3d.  (12c.) 
r  week,  upon  a  written  application  of  the  person  wishing  to  join  the  union,  without 
ballot  or  other  election,  then  and  in  such  case  and  thereafter  the  employers  shall 
employ  members  of  the  union  in  preference  to  nonmembers,  provided  there  are 
members  of  the  union  available  equally  qualified  with  nonmembers  to  perform  the 
particular  work  required  to  be  done  and  ready  and  willing  to  undertake  it,  provided 
that  a  man  shall  become  eligible  for  employment  as  if  already  a  member  of  the 
union  if  he  shall  bona  fide  give  notice  in  writing  to  the  secretary  of  the  union  of 
his  desire  to  join  the  union,  and  shall  pay  or  deposit  with  such  notice  the  sum  of 
•J.<.  (id.  <(»0(-.).  Such  notice  may  be  given  by  delivering  the  same  to  the  secretary 
personally  or  by  leaving  the  same  at  his  office  or  by  depositing  the  same  in  a  box. 
which  it  shall  be  the  duty  of  the  union  to  keep  available  for  that  purpose  at  the 
place  or  one  of  the  places  appointed  for  th«  engagement  of  labor  under  clause  9 
hereof. 

Employers,  in  employing  labor,  shall  not  discriminate  against  members  of  the 
union,  and  shall  not  in  the  engagement  or  dismissal  of  men,  or  in  the  conduct  of 
their  business,  do  anything  for  the  purpose  of  injuring  the  union,  directly  or 
indirectly. 

When  members  of  the  union  and  nonmembers  are  employed  together,  there  shall 


120  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

be  no  distinction  between  members  and  nonmembers,  and  both  shall  work  together 
in  harmony  and  shall  receive  equal  pay  for  equal  work. 

Strikes. — The  union  shall  do  all  in  its  power  to  prevent  any  strike  by  any  of 
the  workers  affected  by  this  award,  and  if  any  strike  shall  occur  in  which  any 
member  of  the  union  shall  take  part,  such  strike  shall  be  prima  facie  evidence  that 
the  union  has  committed  a  breach  of  its  duty  hereunder. 

Memorandum. — Preference  to  unionists  has  been  granted  by  this  award.  In  con- 
nection with  this  it  is  desirable  to  make  it  clear  that  an  employer  will  only  commit 
a  breach  of  award  if  he  employs  a  nonunionist  when  a  member  of  the  union,  equally 
qualified  to  do  the  particular  work  to  be  done,  is  at  the  place  of  engagement  ready 
to  be  engaged.  In  work  such  as  that  done  in  the  port  of  Wellington,  where  the 
traffic  is  so  largely  carried  on  by  steamers  running  to  timetable,  it  is  essential  to 
the  public  interest  that  no  delay  should  take  place  in  the  handling  of  cargo,  and  an 
employer,  therefore,  is  not  bound  to  wait  for  the  arrival  of  members  of  the  union. 
If  they  are  not  available  when  workers  have  to  be  engaged,  the  employer  is  free  to 
engage  any  worker  who  is  available. 

It  will  be  noted  from  the  foregoing  award  that  the  court  establishes 
the  "open  door"  for  the  union,  and  that  under  the  ruling  it  becomes 
impossible  for  a  union  to  discriminate  against  applicants  or  to  estab- 
lish a  monopoly  of  labor  in  any  particular  trade.  It  will  also  be  noted 
that  the  court  fixes  a  nominal  entrance  fee  to  the  union  as  well  as 
nominal  wreekly  dues,  so  that  it  also  becomes  impossible  for  a  union  to 
fix  a  prohibitory  fee  with  the  view  of  limiting  membership.  This,  of 
course,  is  a  very  different  sort  of  unionism  from  that  which  prevails  in 
other  countries  where  unions  can  create  a  monopoly  of  labor  by  limiting 
membership,  fixing  prohibitory  entrance  fees  or  exacting  impossible 
examinations  as  to  technical  trade  merit.  While  under  the  award  the 
shop,  so  to  speak,  may  be  "closed"  the  door  of  the  union  must  be  kept 
"open."  This  largely  minimizes  the  objection  of  many  American 
employers  to  the  ' '  closed ' '  shop. 

The  attitude  of  the  court  on  this  point  does  not,  however,  meet  with 
approval  of  some  unionists  as  may  be  gathered  from  the  following  taken 
from  the  Waterside  workers '  report  of  New  Zealand  for  1906 : 

Preference  to  Unionists. — Mr.  McLaren  said  that  what  they  were  asking  for  was 
that  preference  should  be  granted  by  Parliament,  and  not  by  the  court.  It  was 
marvelous  to  him  to  find  how  the  different  trades  unions  had  been  satisfied  with  the 
position  so  long.  The  industrial  conciliation  and  arbitration  act  was  a  direct 
encouragement  to  nonunionism  as  it  now  stood.  Why  should  the  nonunionist  not 
share  the  responsibility  of  the  unionist  if  he  participated  in  his  benefits?  The  act 
allowed  the  unions  to  bear  the  responsibility,  and  the  leaders  of  the  unions  to  bear 
the  odium  and  censure,  and  sometimes  boycott,  and  yet  gave  power  to  the  court  of 
its  own  free  will  to  divide  the  benefits  equally  between  the  unionist  and  nonunionist. 

*  *  *  Mr.  Young  maintained  that  *  *  *  trades  unionism  was  a  Christian 
work,  and  far  greater  Christian  work  was  being  done  by  the  unions  than  by  large 
number  of  the  churches.  The  unionists  of  this  country  had  sacrificed  the  issue  of 
strikes,  and  in  sacrificing  that  they  had  given  to  the  employer  absolute  security  for 
his  capital.  He  could  invest  the  capital  wherever  he  chose  in  this  country,  knowing 
that  it  was  absolutely  safe  against  strike.  He  could  arrange  his  contracts  at  a 
certain  figure  knowing  exactly  what  he  had  to  pay  for  his  labor  *  *  He  (the 

speaker)  was  aware  of  certain  dangers  surrounding  the  proposal  of  compulsory 
preference  to  unionists.  Say  that  they  had  1,000  men  employed  on  the  Wellington 
wharves,  of  whom  700  were  unionists  and  300  were  not.  Immediately  they  had 


NEW  ZEALAND.  121 

compulsion  these  300  would  come  in,  if  they  desired  to  get  employment,  but  the 
employer  had  exactly  the  same  grounds  of  operation  as  he  had  before  they  joined, 
when  he  took  his  choice,  and  thus  the  preference  benefit  immediately  went.  That 
could  only  be  overcome  by  giving  a  union  the  right  of  excluding  any  one  it  thought 
fit.  They  must  have  the  right  to  exclude,  because  if  they  got  all  the  men  into  the 
ranks  of  the  union,  no  preference  could  exist. 

The  following  report  of  proceedings  before  an  industrial  council  taken 
from  the  Auckland,  New  Zealand,  Herald  of  May  10,  1909,  will  indicate 
how  this  vexed  question  of  preference  to  unionist  is  dealt  with  by  both 
parties  and  how  by  a  method  of  compromise  an  agreement  on  the  point 
is  reached : 

A   KNOTTY   POINT — VIEWS    ON    PREFERENCE. 

The  preference  clause,  to  which  the  Auckland  Butchers'  Industrial  Union  of 
Workers  asked  the  master  butchers  to  agree  at  the  sitting  of  the  conciliation 
council  yesterday,  occasioned  a  good  deal  of  discussion.  The  clause  in  question  was  : 
"Throughout  all  the  departments  recognized  by  this  award  preference  of  employment 
shall  be  given  by  employers  to  members  of  the  Auckland  Butchers'  Industrial  Union 
of  Workers.  When  a  nonunionist  workman  is  engaged  by  an  employer  in  conse- 
quence of  the  union  being  unable  to  supply  a  workman  willing  to  undertake  the 
work,  at  any  time  within  twelve  weeks  thereafter  the  union  shall  have  the  right  to 
supply  a  man  capable  of  performing  the  work,  providing  the  workman  first  engaged 
declines  to  become  a  member  of  the  union.  This  provision  shall  also  apply  to  those 
nonunion  workmen  already  employed." 

Mr.  C.  Grosvenor  (employers'-  representative)  asked  what  objection  there  was  to 
the  clause  in  the  old  award  that  "preference  shall  be  given  to  members  of  the 
butchers'  union,  all  things  being  equal?" 

The  commissioner  (Mr.  T.  Harle  Giles)  said  that  possibly  the  brevity  of  the 
clause  might  lead  to  confusion.  His  interpretation  was  that,  providing  the  union 
was  prepared  to  find  a  man  he  must  be  taken  if  he  was  competent  to  do  the  work. 

Mr.  Grosvenor :  That  is  so. 

Mr.  W.  E.  Sill  (employees'  representative)  :  If  the  employer  says  the  man  is  not 
competent? 

The  Commissioner :  Then  it  is  for  the  union  to  prove  that  he  is. 

Mr.  Sill:  That  is  very  difficult  to  do.  Continuing,  Mr.  Sill  said  the  unionists' 
grievance  was  that  employers  were  prejudiced,  and  nine  times  out  of  ten  would 
choose  a  nonunionist.  It  would  always  be  an  open  question  when  the  union  and  an 

I  employer  differed  as  to  the  competence  of  a  man  which  was  right. 
Mr.  S.  Wing  (employers'  assessor)  :  What  about  the  men  who  refuse  to  join  the 
union  on  conscientious  principles? 
Mr.  Sill :  I  never  met  such  a  man. 
Mr.  Wing :  I  have. 
Mr.  Sill :  I  think  it  highly  improbable  there  are  such  men.     I  met  one  who  was 
supposed  to  have  such  principle,  but  I  found  the  reason  he  did  not  join  the  union 
was  that  he  thought  the  union  would  not  do  anything  for  him.  as  he  was  earning 
more  than  the  award  wages.     He  did  not  recognize  that  the  union  fixed  a  minimum, 
and  that  he  could  earn  more  than  that  if  an  extra  good  man. 

The  commissioner  said  he  did  not  think  employers  wished  to  refuse  to  recognize 
the  unions,  which  were  of  great  benefit  to  the  workers. 

Mr.  R.  Salmon  (employers'  assessor)  :  I  think  the  time  will  soon  arrive  when 
all  workers  will  be  compelled  to  contribute  to  the  union,  and  employers  will  be 
responsible  for  taking  the  contributions  off  their  wages. 

Mr.  Grosvenor :  A  clause  quite  as  rational  as  one  of  preference  to  unionists 
would  be  one  that  no  man  should  work  for  an  employer  not  a  member  of  the 
master's  union. 

Eventually  it  was  agreed  that  the  clause  should  not  apply  to  nonunion  workmen 
already  employed,  and  that  the  time  during  which  the  union  could  object  to  a 
nonunionist  be  confined  to  a  week. 


122  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

STRIKES. 

For  many  years  New  Zealand  was  heralded  throughout  the  world  as 
"the  country  without  strikes."  Literally,  this  is  not  true.  There  have 
been  strikes  in  New  Zealand  since  the  act  went  into  force,  but  so  few  of 
them,  comparatively,  that  it  would  be  entitled  to  be  called  "the  country 
with  few  strikes." 

In  New  South  Wales  it  is  illegal  to  strike  under  any  circumstances. 
Not  so  in  New  Zealand.  The  right  to  legally  strike  is  not  denied  if  cer- 
tain formalities  are  gone  through  first,  such  as  getting  the  union  can- 
celed. A  man  need  not  work,  nor  need  an  employer  give  him  work  if  he 
does  not  wish  to  do  so,  but  if  either  employers  or  workers  agree  or  con- 
spire together  to  commit  a  strike  or  a  lockout  while  under  an  award,  that 
is  an  offense.  It  is  concerted  action  after  having  benefited  by  the  privi- 
lege of  going  under  an  award  that  is  reprehended. 

Labor  Secretary  Tregear  furnished  the  following  statement  of  strikes 
since  the  act  went  into  effect  in  1894 : 

There  have  been  twenty-five  strikes  in  New  Zealand  since  the  inception  of  the 
industrial  conciliation  and  arbitration  act,  involving  approximately  1,14(5  strikers 
and  rendering  idle  approximately  2,389  men.  The  total  number  of  days  the  men 
were  idle  from  their  respective  employments  was  approximately  318.  As  far  as  can 
be  ascertained  the  total  loss  of  wages  to  the  workmen  concerned  approximated 
£17.679  ($85,744).  while  the  loss  to  the  employers  was  about  £15,750  ($75,418). 

In  addition  to  these  cases,  there  have  been  two  or  three  disturbances  since — one 
affecting  the  miners  employed  by  the  Taratu  Coal  Company,  but  it  really  was  not 
a  strike  at  all.  as  the  men.  being  dissatisfied  with  the  wages  awarded  by  the  court, 
simply  left  the  service  of  the  mine  on  a  Saturday  afternoon  and  did  not  return  to 
work  on  the  Monday  morning,  when  the  award  became  operative.  The  mine  man- 
agement subsequently  filled  their  places  with  other  miners  in  the  district.  In  January 
there  was  a  small  strike  of  employees  at  the  Paki  Freezing  Company's  works,  in 
which  seventeen  men  were  involved.  The  strike  arose  out  of  a  dispute  between 
the  manager  and  the  fellmongers  as  to  the  spell  in  the  morning  and  afternoon  in 
which  to  smoke.  It  was  really  a  very  trivial  affair,  but  the  men  were  proceeded 
against  by  the  department  and  fined  £1  ($4.85)  each  in  the  magistrate's  court. 
There  was  also  a  strike  of  twelve  butchers  employed  at  the  Picton  Freezing  Works 
in  March  of  this  year  for  higher  wages.  As  these  employees  were  not  registered 
under  the  industrial  conciliation  and  arbitration  act  it  was  not  an  offense.  The  men 
were  only  idle  a  very  short  time  and  accepted  the  wage  of  11*4 d.  (22i,4c. )  per  hour, 
the  same  rate  as  paid  to  the  Canterbury  men.  They  wore  formerly  paid  10%d.  (21c.) 
and  struck  for  Is.  (24c.)  per  hour. 

You  will  see  then  that  for  a  period  of  fifteen  years,  we  have  not  averaged  two 
strikes  per  year,  and  no  doubt  after  the  perusal  of  the  facts  furnished,  you  will 
come  to  the  conclusion  that  some  of  the  disturbances  hardly  deserve  the  name  of  a 
strike. 

I  may  say  that  as  far  as  the  department  can  ascertain  on  the  result  of  the  strikes 
twenty-two  were  favorable  to  the  men,  namely,  the  men  succeeded  in  getting  their 
terms  or  something  approaching  them,  and  in  three  cases  the  employers  were  suc- 
cessful in  defeating  the  demands  of  the  men. 

Most  of  the  strikes  which  have  taken  place  since  the  act  went  into 
effect  were  due,  it  is  claimed,  to  the  imperfect  machinery  provided  for 
the  administration  of  the  law.  The  conciliation  board  provided  for  in 


NEW  ZEALAND.  123 

the  original  bill  proved  ineffective  and  was  finally  abandoned.  This 
threw  so  much  work  on  the  arbitration  court  that  it  became  hopelessly 
congested.  Cases  were  kept  on  the  court  calendar  for  months  and  some 
of  them  for  years.  Meanwhile,  the  dissatisfaction  of  the  men  who  could 
get  no  redress  was  intensified  and  they  were  goaded  on  to  a  final  viola- 
tion of  the  law. 

Some  of  the  testimony  of  labor  representatives  who  appeared  before 
the  legislative  labor  bills  committee  in  1908,  when  the  amendments  since 
adopted,,  were  under  discussion  emphasize  this  point.  One  labor  repre- 
sentative said : 

We  consider  that  a  number  of  the  strikes  that  have  taken  place  in  New  Zealand 
would  never  have  taken  place  had  there  been  machinery  in  existence  whereby  the 
disputes  could  have  been  settled  without  the  delays  that  have  occurred  in  the  past. 
*  *  *  We  say,  however,  that  no  matter  how  drastic  the  clauses  of  an  act  may  be. 
it  would  be  impossible  to  prevent  strikes  altogether.  You  may  lessen  them  by  good 
legislation,  but  it  would  be  impossible  to  prevent  them. 

Another  labor  representative  spoke  as  follows : 

It  has  to  be  remembered  that  no  act  passed  by  any  legislature  prevents  crime. 
You  can  not  stop  the  committal  of  murder,  although  a  man  can  be  hanged  for  it. 
You  can  not  stop  strikes  by  arbitration,  although  you  can  minimize  them  by  means 
of  arbitration,  and  we  contend  that  the  present  act  has  done  that. 

Q.  Are  you  aware  that  the  majority  of  the  workers  are  in  favor  of  the  arbitration 
act? 

A.  Y'es,  I  do  not  think  there  is  any  doubt  about  it.  Because  a  certain  number 
like  to  override  an  award  it  does  not  follow  that  any  one  believes  in  strikes.  No  one 
believes  in  strikes  that  I  know  of. 

In  a  speech  delivered  by  Attorney  General  Findlay  of  New  Zealand 
in  Wellington  in  July,  1908,  referring  to  the  effect  the  act  has  had  on 
strikes,  he  said: 

*  *  *  I  contend  that  for  many  years  the  act  had  prevented  strikes,  and  that  if 
reasonably  used  in  the  spirit  intended  by  its  framer  it  would  always  prevent  them. 
This  contention  has  been  adversely  criticised.  I  submit  these  considerations  to 
unbiased  critics:  (a)  There  were  in  1906  290,000  wage-earners  of  all  kinds  in  New 
Zealand,  and  the  average  number  throughout  the  career  of  the  act  would  be  over 
250.000;  (b)  Up  to  the  present  time  there  have  been  eighteen  strikes  in  thirteen 
years. 

Eighteen  strikes  have  taken  place  in  New  Zealand,  really  all  small  and  short  lived, 
and  only  twelve  of  these  have  been  illegal,  since  in  six  the  act  had  no  application. 
In  these  six  there  was  no  union  award  or  binding  agreement.  In  these  illegal  strikes, 
74O  men  all  told  engaged,  that  is  less  than  one  third  per  cent  of  the  above  average 
total  of  wage-earners  in  this  country,  and  of  those  engaged  in  strikes,  legal  and 
illegal,  not  one  half  per  cent  of  these  250,000  workers.  The  days  of  idleness  of 
workers  due  to  these  strikes  were  very  few.  In  some  cases  the  strike  lasted  only  a 
day  or  two. 

Now  compare  these  figures  with  our  motherland's  experience.  From  1891  to 
1900.  that  is,  ten  years,  there  were  7,931  labor  conflicts  in  Great  Britain,  involving 
2.732.169  workers.  It  is  estimated  that  the  total  wage-earners  of  Great  Britain  of 
all  classes  was  in  1906  14,640,000,  and  during  the  decade  in  question  would  be 
about  12,700,000.  Thus,  during  this  decade  over  twenty  per  cent  of  the  British 
workers  were  at  some  time  or  other  directly  concerned  in  a  labor  conflict,  as  com- 
pared with  less  than  one  half  per  cent  in  New  Zealand  in  thirteen  years. 


124  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

The  total  number  of  days  the  British  workmen  were  idle  in  these  ten  years 
owing  to  strikes  (i.  e.,  multiplying  the  days  idle  by  the  number  of  men  idle)  was 
106,192,528,  making  an  average  idleness  of  about  thirty-eight  days  per  man. 

To  treat  the  act  as  a  disabled  and  useless  machine  because  a  few  short-lived 
strikes  have  taken  place,  and  a  few  very  noisy  gentlemen  have  declared  that  they 
will  have  none  of  it  is  therefore  error.  But  let  us  be  just  before  we  are  serious. 
Follow  the  career  of  the  court  and  the  act  since  their  inception,  follow  the  court's 
work  to-day  with  a  fair  mind,  and  you  will  admit  that  it  has  done  and  is  doing 
splendid  work,  discharging  one  of  the  most  difficult  tasks  with  fairness,  ability,  and 
patience.  I  claim  that  the  act  has  done  immense  service  in  this  country  in  the 
cause  both  of  industrial  peace  and  fair  wages.  That  it  is  capable  of  improvement 
(as  I  hope  to  show)  should  not  belittle  that  service. 

Judge  Sims,  the  president  of  the  court  of  arbitration,  said  that  there 
had  been  no  real  illegal  strike  in  New  Zealand  for  eleven  months,  and 
that  in  his  opinion  the  new  law  will  make  for  fewer  strikes. 

The  president  of  the  arbitration  court  in  common  with  the  government 
has  made  it  plain  that  workers  can  not  strike  and  have  an  arbitration 
act  at  the  same  time.  They  must  choose  between  the  two  and  with  this 
point  made  clear  and  emphasized  by  recent  inflicted  penalties  for  illegal 
striking,  there  is  every  probability  that  unions  will  prefer  to  abide  by 
the  law.  Labor  leaders  throughout  the  dominion  are  of  this  opinion. 
One  of  the  most  intelligent  and  aggressive  among  them  said  to  me  that 
under  the  amended  law  strikes  will  diminish,  if  not  entirely  disappear 
for  the  reason  that  to  strike  now  means  to  lose  the  benefits  of  an  award 
and  to  be  fined  besides. 

A  prominent  public  official  said :  "Public  sentiment  is  against  strikes, 
as  it  feels  that  it  is  'welching'  on  the  part  of  labor  to  strike  after  the 
good  for  labor  that  has  been  accomplished  for  it  by  the  act  and  by  the 

court. ' ' 

EMPLOYERS'  ASSOCIATIONS. 

There  has  been  a  marked  growth  of  these  institutions  since  the  act 
first  went  into  force.  In  1895  there  was  but  one  employers'  association 
with  a  membership  of  65.  In  1906,  the  latest  available  figures,  there 
were  113  employers'  associations,  with  a  membership  of  3,276.  Each 
center  has  its  own  organization  under  the  direction  of  a  capable  secre- 
tary, and  all  of  them  are  federated  under  a  very  capable  general  sec- 
retary, Mr.  Pryor,  who  makes  his  headquarters  in  the  capital  city  of 
Wellington.  Such  of  the  employers'  associations  secretaries  as  I  had 
an  opportunity  of  meeting  impressed  me  Avith  their  intelligence,  earnest- 
ness, and  fidelity  of  purpose.  The  employers'  associations  secretaries 
usually  act  as  the  employers'  representative  before  the  industrial  com- 
mittees and  before  the  arbitration  court,  where  the  unions  are  represented 
by  their  secretaries.  The  secretaries  on  both  sides  have  developed  into 
capable  lay  lawyers  on  labor  laws.  At  such  sessions  of  the  arbitration 
court  and  industrial  committees  as  I  was  enabled  to  attend,  I  wras  im- 
pressed with  their  knowledge  of  the  law  and  their  ability  to  expound  it. 


NEW  ZEALAND.  125 

The  following  copy  of  an  industrial  council  held  in  Auckland  is  taken 
from  the  Auckland  Herald  of  May  18,  1909.  It  will  illustrate  the 
methods  pursued  at  these  conferences  for  the  arriving  at  an  agreement, 
and  the  part  played  in  them  by  the  union  secretary,  the  secretary  of  the 
employers'  association  and  by  the  commissioner,  who  under  the  law  has 
no  vote  and  acts  simply  as  chairman  of  the  conference : 

TRIUMPH    OF    CONCILIATION — ANOTHER    DISPUTE    SETTLED — THE    BUTCHERING    TRADE. 

The  conciliation  council  met  yesterday  to  deal  with  the  dispute  between  the 
Auckland  Butchers'  Industrial  Union  of  Workers  and  the  Master  Butchers'  Union 
of  Employers.  A  conference  had  been  held  between  the  parties  and  agreement 
reached  on  all  points  except  the  wages  of  order  men  and  general  hands,  hours  and 
preference.  Mr.  T.  Harle  Giles,  conciliation  commissioner,  presided,  and  the  em- 
ployers' assessors  were  Messrs.  J.  W.  Marks,  S.  Wing,  and  R.  Salmon,  and  the 
employees'  assessors  were  Messrs.  G.  Graulty,  G.  Lubbock,  and  J.  Lindsay.  Mr.  W.  E. 
Sill  appeared  for  the  employees  and  Mr.  C.  Grosvenor  for  the  employers. 

Mr.  Sill  stated  that  the  union  was  not  willing  to  make  any  concession  on  the 
points  which  were  in  dispute.  Its  final  demands  outstanding  were  that  order  men 
should  be  paid  £2  12s.  Gd.  per  week,  general  hands  £2  10s.,  and  that  preference 
should  be  granted  to  unionists,  as  in  recent  awards.  As  regards  the  half-holiday 
the  employees  stuck  to  the  clause  in  their  original  demands  as  follows :  "Employers 
during  any  week  in  which  a  holiday  or  holidays  occur  may  give  their  workers  the 
extra  time  off  necessary  to  comply  with  the  limit  as  to  hours  fixed  by  the  award 
during  such  holiday  week,  or  the  next  following  week."  If  these  demands  were 
granted  the  union  wrould  be  willing  to  allow  the  whole  agreement  to  go  forward  as 
the  recommendation  of  the  council ;  if  not,  it  would  withdraw  the  whole  agreement. 
A  new  clause  the  union  wished  to  have  added  was  that  overtime  should  be  paid  for 
at  time  and  a  half  for  other  than  preservers.  This  new  clause  was  agreed  to. 

Mr.  Wing  suggested,  on  behalf  of  the  employers,  that  a  sliding  scale  be  agreed 
upon  for  order  hands,  £2  5s.  being  paid  for  men  from  twenty-one  to  twenty-three 
years  of  age,  and  £2  12s.  6d.  for  men  over  twTenty-three. 

After  some  discussion,  Mr.  Lindsay,  on  the  commissioner's  suggestion,  offered  on 
behalf  of  the  union  to  accept  £2  5s.  .for  order  men  up  to  twenty-two  years  and 
£2  12s.  6d.  thereafter. 

Considerable  debate  took  place  on  the  question  of  hours.  The  men  had  originally 
demanded  a  forty-eight-hour  week,  while  the  employers  held  for  a  fifty-nine-hour 
week.  The  parties  eventually  narrowed  the  margin  down  to  one  hour,  one  side 
holding  for  fifty-six  and  the  other  for  fifty-seven  hours,  and  the  court  adjourned 
to  allow  the  parties  to  deliberate. 

On  resumption  it  was  agreed  to  compromise  on  wages  and  hours  as  follows : 
Order  men  between  twenty-one  and  twenty-three  to  receive  £2  7s.  6d.,  and  over 
that  age  £2  12s.  6d. ;  general  hands,  £2  10s.  per  week,  the  number  of  weekly  hours 
being  fifty-six. 

Late  in  the  afternoon  all  the  clauses  were  agreed  to,  and  the  agreement  will  be 
sent  forward  to  the  arbitration  court  as  the  recommendation  of  the  council. 

At  the  conclusion  of  the  sitting  Mr.  Sill  remarked  that  to  the  commissioner  was 
due  the  entire  credit  for  bringing  the  matter  to  so  satisfactory  a  termination. 

Mr.  S.  Wing  said  had  it  not  been  for  Mr.  Giles  no  agreement  would  have  been 
arrived  at.  He  moved  a  hearty  vote  of  thanks  to  the  commissioner. 

Mr.  Lubbock  seconded  the  motion,  which  was  carried  with  acclamation. 

In  returning  thanks  the  commissioner  said  it  was  the  toughest  dispute  he  had 
yet  met. 

On  the  motion  of  the  employers'  representatives,  a  motion  appreciative  of 
Mr.  W.  E.  Sill  (workers'  representative)  was  passed,  and,  on  the  motion  of  the 
employees'  representatives,  a  similar  vote  was  passed  to  Mr.  C.  Grosvenor,  employers' 
representative. 


126  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

THE   AGREEMENT. 

The  following  is  the  full  list  of  weekly  wages  agreed  upon :  First  shopman.  £3  ."is.  : 
second  shopman,  £2  15s.  ;  small  goodsmen,  £2  12s.  and  £2  5s. ;  cellarmen  and  packers. 
£2  15s.  and  £2  5s. ;  bacon-curers,  £2  15s.  and  £2  7s.  6d. ;  'head,  feet,  and  tripe  hands. 
£2  7s.  6d.  and  £2  2s. ;  boners,  £2  7s.  6d.  ;  men  in  charge  of  hawking  carts,  £2  17s.  <Jd.  : 
drivers,  £2  6s.  to  £2  10s. ;  ordermen,  21  to  23,  £2  7s.  6d.  over  23,  £2  12s.  6d. ;  general 
hands,  £2  10s.  Boys  and  youths  over  14  and  under  15  years,  10s.  per  week;  15  and 
under  16,  12s.  6d. ;  16  and  under  17,  15s. ;  17  and  under  18,  20s. ;  IS  and  under  1ft. 
25s.  ;  19  and  under  21.  30s. 

Meat  preservers,  £3;  extractors  (first),  £2  5s.;  extractors  (second),  £2  2s.: 
cutters,  £2  6s. ;  fillers,  £2  6s. ;  sealers,  £2  2s. ;  toppers,  £2  2s. ;  pressers,  £2  2s.  : 
solderers,  £2  5s. ;  solder  spiriters,  £1  12s.  ;  tin-cleaners,  £1  12s. ;  tin-washers,  £1  12s. 
Casual  labor  (adult)  to  be  paid  at  a  minimum  rate  of  10s.  per  day  for  ordinary 
days  and  12s.  for  Saturdays. 

When  a  public  holiday  occurs  on  any  day  other  than  Saturday,  employees  may 
be  called  upon  to  work  up  to  three  p.  m.  on  such  Saturday  holiday. 

The  award  will  apply  to  the  whole  of  the  northern  industrial  district  outside 
Poverty  Bay,  and  shall  remain  in  force  until  December  31,  1911. 

ARBITRATION  COURT  AWARDS. 

The  following  report  prepared  by  the  Labor  Department  for  the  Min- 
ister of  Labor  gives  the  history  of  the  awards  granted  by  the  court  of 
arbitration : 

The  Hon.  the  Minister  for  Labor. 

The  following  figures  have  been  compiled  for  the  award  return  which  I  sent  you 
last  week,  and  may  prove  of  interest  and  service  to  you. 

At  the  beginning  of  September  303  awards  or  agreements  were  enforced  through- 
out New  Zealand,  and  were  divided  among  the  several  districts  as  follows :  Northern 
district  (Ak.),  69;  Wellington,  63;  Canterbury,  73;  Otago  and  Southland,  70: 
Taranaki,  6;  Marlborough,  2;  Nelson,  9;  Westland,  11. 

In  no  less  than  102  awards  or  agreements  the  arbitration  court  gave  either  an 
increase  of  wages  or  less  hours  over  the  conditions  given  by  previous  awards.  In 
some  cases  both  increased  pay  and  shorter  hours  were  granted.  These  awards 
which  gave  better  conditions  are  divided  into  districts  as  follows :  Northern,  28 : 
Wellington,  23;  Canterbury,  26;  Otago  and  Southland,  24;  Westland,  1. 

In  90  of  the  102  awards  increased  wages  were  given  to  journeymen,  and  the 
average  increase  is  estimated  at  ten  per  cent  over  rates  paid  under  original  awards. 
(It  must  be  remembered  that  the  wages  paid  prior  to  the  act  coming  into  force  were, 
generally  speaking,  less  than  the  amounts  subsequently  given  by  the  boards  and 
court. ) 

The  increased  wages  amounted  in  one  case  (tailoresses,  Auckland)  from  17s.  6d. 
($4.20)  (awarded  in  1897)  to  25s.  ($6.00)  per  week  (awarded  in  1904)— a  rise 
of  43  per  cent. 

The  lowest  increase  was  that  given  to  the  timber  yards  and  coal  carters  of 
Canterbury  (Ashburton).  who  received  an  increase  of  Is.  (24c.)  per  week  on  an 
average  wage  of  44s.  ($10.56)  or  about  two  and  a  third  per  cent. 

The  greatest  drop  in  hours  worked  is  shown  in  the  Auckland  city  drivers'  award — 
from  fifty-four  hours  in  1899  to  forty-seven  and  a  half  hours  in  1906.  The  division 
of  hours  under  the  various  awards  and  agreements  in  force  are  approximately  as 
follows  :  Not  fixed,  26 ;  44  hours  and  under,  60 ;  48  hours  and  under,  242 ;  52  hours 
and  under,  26 ;  60  hours  and  under,  41 ;  70  hours  and  under,  9. 

In  several  awards  the  hours  worked  by  men  and  women  vary.  Both  classes  are 
included  in  this  return.  The  hours  above  52  are  those  fixed  for  such  callings  as 
cooks  and  waiters,  cabmen,  drivers,  dairymen,  grocers,  butchers,  hairdressers,  etc. 

The  figures  show  that  there  are  302  cases  where  the  hours  have  been  fixed  at 
forty-eight  per  week  and  under,  while  there  are  76  cases  fixing  fifty-two  hours  and 


NEW  ZEALAND.  1  '2  I 

under,  therefore,  almost  seventy-five  per  cent  of  the  existing  awards  fix  an  eight- 
hour  day  or  less. 

Comparing  the  rates  of  weekly  wages  paid  in  the  various  awards,  the  result  is 
as  follows:  ($9.60)  40s.  and  under,  13;  ($10.80)  45s.  and  under,  95;  ($11.52)  48s. 
and  under,  73;  ($13.20)  55s.  and  under,  150;  ($14.40)  60s.  and  under.  123: 
<xi. 1.84)  66s.  and  under,  44;  ($16.80)  70s.  and  under,  23;  ($18.00)  75s.  and 
under,  12;  ($19.20)  80s.  and  under,  7. 

In  cases  where  different  wages  are  paid  under  one  award  (such  as  the  typo- 
graphical, bakers,  butchers,  coal  miners,  etc.)  the  various  minimum  wages  are 
included:  for  instance,  bakers,  first  hand,  63s.  ($15.10)  ;  second  hand,  53s.  ($12.72)  : 
third  hand,  48s.  ($11.52),  are  shown  in  respective  columns.  Seamen,  cooks  and 
stewards,  waiters,  slaughtermen,  shearers,  wharf  laborers,  and  others,  have  not 
been  dealt  with,  as  the  rates  paid  are  (1)  very  low;  (2)  employment  is  inter- 
mittent ;  or  (3)  piece  rates  are  paid. 

In  181  cases  the  wages  paid  are  48s.  ($11.52)  and  less;  while  in  3.19  cases  an 
average  of  55s.  ($13.20)  and  over  is  paid,  or  in  other  words,  fifty  per  cent  of  the 
awards  compared  show  that  a  weekly  wage  of  55s.  ($13.20)  and  over  is  fixed  as 
the  minimum. 

In  fifty  instances  the  awards  of  the  court  have  remained  stationary,  that  is. 
neither  the  hours  nor  the  wages  have  been  altered  by  subsequent  decisions.  Ten 
awards  are  classified  as  being  difficult  to  compare  with  similar  awards  given  pre- 
viously, and  in  136  cases  one  award  or  agreement  only  exists.  The  court  has  in 
five  cases  awarded  less  favorable  conditions,  i.  e.,  lower  wages,  or  increased  hours. 

THE  EFFICIENCY  OF  NEW  ZEALAND  LABOR. 

Much  complaint  is  heard  among  New  Zealand  employers  to  the  effect 
that  one  evil  consequence  of  the  act  is  the  diminished  efficiency  of  labor, 
for  which,  as  a  rule,  employers  hold  the  act  responsible. 

In  the  evidence  offered  by  employers  before  the  labor  bills  committee 
of  Parliament  in  1908,  the  following  testimony  was  brought  out,  bearing 
on  this  point. 

Mr.  Prior,  secretary  of  employers'  association,  said: 

I  was  recently  conducting  a  case  for  the  employers  before  the  arbitration  court, 
and  got  it  from  a  witness  on  oath  that  the  secretary  of  the  union  had  gone  around 
among  the  workers  and  told  them  not  to  hustle,  as  the  award  fixed  their  wages,  the 
\\  ages  were  not  dependent  upon  the  amount  of  work  they  did. 


111*. 

•f 


A  builders '  representative  testified  as  follows : 

We  find  in  our  particular  business  that  although  the  worker's  wages  have  not 
increased  more  than  about  ten  per  cent  on  what  they  were  twelve  or  fourteen  years 

;o,  his  efficiency  or  the  amount  of  work  we  get  done  is  not  more  than  fifty  per  cent 
of  what  it  was  twelve  years  ago.  I  will  tell  you  why,  if  I  may  mention  an 
instance.  About  fourteen  years  ago  I  had  a  contract  and  allowed  6s.  ($1.44)  per  foot 

r  labor  on  raw  material,  made  a  profit  of  6d.  (12c. )  out  of  that,  while  I  have 
requently  allowed  ten  shillings  now  ($2.40)  for  the  same  amount  of  work  and 
made  a  loss,  although  it  is  exactly  the  same  class  of  work.  That  simply  goes  to 

ow  that  there  is  fess  work  being  done  by  the  worker  now  than  there  was  twelve 
years  ago,  while  the  wages  have  not  increased  probably  more  than  ten  per  cent. 
That  accounts  in  a  very  large  degree  for  the  increased  cost  of  building. 

The  testimony  of  Mr.  George  T.  Booth,  an  ironmaster  of  Christchurch. 

was  as  follows : 

I  am  quite  sure  that  the  cost  of  the  arbitration  system  has  resulted  in  a  loss  of 
industrial  efficiency  far  greater  than  ever  resulted  from  strikes,  or  than  was  likely 
to  result  during  the  period  the  arbitration  system  has  been  in  operation. 


128  .        REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

• 

Q.  Do  you  mean  to  say  that  the  moral  fiber  of  workmen  generally  has  deteriorated? 
A.  Yes,  it  has  been  deteriorating  for  many  years  past. 
Q.  Are  there  any  causes  outside  of  what  you  have  been  discussing? 
A.  Yes. 

Q.  Can  you  name  them? 

A.  I  think  that  some  of  the  false  social  ideals  that  are  being  preached  here  have 
had  a  considerable  amount  to  do  with  it. 

Mr.  Booth  further  testified  before  this  legislative  committee  that  in 
his  trade,  the  engineering,  there  had  been  a  falling  off  in  the  workman's 
efficiency  of  twelve  per  cent  in  1905  as  compared  with  1901.  He  gave 
facts  and  figures  to  prove  his  statement,  taken  from  the  New  Zealand 
government  reports  which  give  the  wages  paid  and  the  output. 

On  the  other  side  statements  are  made  by  labor  representatives  deny- 
ing these  charges.  One  labor  representative  pointed  out  that  the  present 
competition  among  the  workers  is  keen  enough  to  insure  that  each 
worker  is  required  to  put  his  utmost  into  the  day's  work.  At  a  trades 
council  conference  one  of  the  delegates  said : 

Some  years  ago,  when  I  was  working  in  the  timber  industry,  we  thought  it  was 
an  extraordinary  tally  for  a  man  to  turn  out  8,000  feet  a  day — that  was  1,000  feet 
an  hour.  Later  on  men  turned  out  10,000  feet  a  day  for  a  month.  I  took  the  tally 
myself  and  the  average  was  10,000  feet  a  day  for  the  nineteen  days  that  the  mill 
worked.  There  is  a  practice  of  playing  one  mill  off  against  another,  and  if  one  mill 
turned  out  a  large  quantity  another  would  try  to  beat  it.  We  heard  of  one  man 
turning  out  16,000  feet,  and  that  record  stood  for  a  considerable  time,  but  eventually 
we  had  a  benchman  who  turned  out  22,000  feet,  and  when  the  case  was  being  tried 
at  Invercargill  la,st  week,  we  heard  the  extraordinary  story .  of  a  benchman  who 
turned  out  28,000  feet. 

Q.  Is  the  general  average  about  8,000  feet  a  day? 

A.  The  average  per  day  is  very  much  in  excess  of  what  it  was  many  years  ago. 

Labor  Secretary  Tregear,  on  being  invited  to  express  an  opinion  on 
this  point,  said: 

This  is  a  vexed  question.  Some  employers  declare  that  the  act  has  diminished 
the  efficiency  of  labor,  and  quote  figures  to  prove  their  assertions.  I  doubt  both 
their  alleged  facts  and  figures,  preferring  to  take  the  official  figures  in  the  Yearbook. 
This  states,  190S  (page  346),  that  the  wages  in  factories  rose  in  five  years  at  the  rate 
of  thirty-five  per  cent,  and  that  the  value  of  the  produce  or  output  in  these  factories 
(top  of  page  347)  rose  thirty-one  per  cent.  This  slight  difference  may  be  accounted 
for  thus.:  The  employment  of  some  thousands  more  of  hands  does  not  always  mean 
a  proportionate  increase  of  output.  If  you  employ  a  hundred  men  in  your  factory 
and  they  give  you  an  income  of  £1,000  a  year,  it  does  not  follow  that  by  putting 
on  two  hundred  men  you  can  get  £2,000.  There  may  not  be  the  machines  to  work 
on  or  the  market  to  sell  the  goods.  So,  likewise,  it  does  not  follow  because  you  can 
get  ten  knots  an  hour  out  of  a  steamer  by  burning  one  ton  of  coal  an  hour  that  you 
can  get  thirty  knots  by  burning  three  tons.  I  consider  thirty-one  per  cent  rise  in 
production  a  very  fair  equivalent  for  thirty-five  per  cent  rise  in  wages.  It  seems 
to  me  this  settles  the  question  both  of  efficiency  and  of  the  "going  easy"  accusation 
against  New  Zealand  workers. 

The  figures  above  quoted  by  Secretary  Tregear  would  show  a  decline 
of  over  eleven  per  cent,'  which  rather  supports  the  contention  made  by 
Mr.  George  T.  Booth  before  the  legislative  committee  that  there  had 


t] 

i 


NEW  ZEALAND.  129 

a  decline  in  efficiency  in  the  engineering  business  in  five  years  of 
velve  per  cent.  The  Yearbook  figures  would  indicate  that  this  decline 
ould  apply  generally. 

While  the  facts  show  that  there  has  been  a  diminished  efficiency  in 
ecent  years  on  the  part  of  the  worker  in  New  Zealand,  the  cause  for 
his  result,  as  I  shall  endeavor  to  show  later  in  this  report,  is  not  cor- 
rectly understood.  I  hope  to  be  able  to  make  clear  that  this  diminished 
efficiency  has  little  or  no  relation  to  the  labor  legislation  enacted  in  New 
Zealand.  Diminishing  efficiency  is  complained  of  in  trades  and  indus- 
tries in  New  Zealand  that  do  not  come  under  the  act.  A  big  bridge 
uilder  and  contractor  in  New  Zealand  made  to  me  the  statement  that 
is  men  are  not  unionized  nor  are  they  working  under  an  award,  yet  he 
finds  a  diminishing  output  compared  with  previous  years  of  fully  ten 
per  cent. 

HAS   THE  ACT    MADE   FOR   STEADINESS   IN  BUSINESS. 

There  are  those  who  claim  the  act  has  unfavorably  affected  the  steadi- 
ness of  business.  I  could  find  no  evidence  of  this;  on  the  contrary,  it 
seemed  so  far  as  I  could  discover,  to  have  the  opposite  effect  and  to 
establish  conditions  that  afford  a  higher  degree  of  protection  to  the 
employer  than  is  found  in  most  other  countries.  The  awards  are  gener- 
ally made  for  extended  terms,  usually  for  two  or  three  years  and  the 
court  does  not  favor  frequent  or  violent  charges.  In  countries  where 
strikes  and  lockouts  prevail  the  employer  has  no  such  protection.  An 
award  once  made,  the  New  Zealand  employer  can  safely  rely  on  the 
wage  established  for  the  life  of  the  term  of  the  award,  subject  of  course 
in  good  times  to  competition  among  employers  for  labor  of  higher  effi- 
ciency, which  often  commands  a  premium  over  the  minimum  wage. 

THE   CREATION   OP   NEW   CRIMES. 

One  criticism  that  I  frequently  heard  made  on  the  act  is  that  it  has 
created  new  crimes.  It  is  true  that  the  law  makes  the  strike  or  the 
lockout  a  punishable  offense.  In  return  for  this  the  employer,  the 
worker,  and  the  public  get  a  higher  degree  of  industrial  peace  than  is 
found  in  other  countries. 

PREVENTING  MEN  PROM  WORKING  EXCEPT  ON   COURT  TERMS. 

The  act  of  course  prevents  men  from  working  except  on  terms  fixed 
by  the  court.  This  is  hardly  avoidable  under  any  system  of  collective 
bargaining,  whether  such  collective  bargaining  be  legalized  by  the 
state  or  established  by  a  strong  union.  The  system  is  likely  to  work  a 
hardship  on  the  few  inefficient  or  slow  workers,  but  it  tends  to  insure 
a  fair  wage  to  the  great  body  of  workers.  Thus  making  for  the  greatest 
good  to  the  greatest  number.  As  previously  explained,  the  slow  worker 

9 


130  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

is  not  ignored  by  the  law,  but  a  provision  is  made  whereby  he  can  be 
given  a  certificate  permitting  him  to  work  below  the  fixed  wage.  It  is. 
pointed  out  that  this  is  a  far  safer  plan  than  to  permit  the  few  to 
endanger  the  wage  rate  of  the  many. 

INTERFERENCE  WITH  PRIVATE  MANAGEMENT  ON  THE  PART  OF  THE  COURT, 

This  is  another  criticism  that  the  investigator  frequently  hears 
brought  up  against  the  act.  It  is  admittedly  true  that  to  the  extent 
of  fixing  wages  and  conditions  under  which  men  shall  work  there  is  an 
interference  on  the  part  of  the  court.  Under  modern  labor  unionism 
no  employer  can  longer  hope  to  be  supreme  in  dictating  the  wage  the 
worker  shall  receive  or  the  conditions  under  which  he  shall  work.  When 
these  matters  were  solely  in  the  hands  of  the  employers,  experience  has. 
shown  that  the  unfair  among  them  abused  the  privilege  and  crowded 
the  worker  down  oppressively,  compelling  his  fairer  minded  competitor 
to  follow  his  example  or  go  out  of  business.  The  question  then  remains, 
shall  the  wages  and  conditions  be  fixed  almost  solely  by  the  worker 
through  his  union,  which  is  often  the  case  where  the  union  is  strong, 
or  shall  a  fair-minded  and  disinterested  court  hear  both  sides  and  fix 
a  wage  fair  to  both,  and  working  conditions  fair  to  both  ?  Aside  from 
wages  and  working  conditions  the  arbitration  court  does  not  in  any  way 
interfere  with  private  management  or  control. 

CAN  THE  DECISIONS  AGAINST  THE  MEN  BY  THE  ARBITRATION  COURT  BE 

ENFORCED  ? 

Wherever  the  question  of  compulsory  arbitration  came  up  for  dis- 
cussion in  the  countries  .of  Europe  where  I  made  my  investigationsr 
the  point  was  invariably  made  that  compulsory  arbitration  Avas  doomed 
to  ultimate  failure,  because  in  the  nature  of  things  the  court  decisions 
could  be  enforced  against  the  employer  because  he  is  a  responsible  party, 
but  that  they  could  not  be  enforced  against  the  worker  because  he  is 
financially  irresponsible,  nor  could  he  be  made  to  work  by  any  court 
anywhere  if  he  did  not  want  to  work.  The  facts  are  that  the  decisions 
can  not  be  enforced  against  the  employer  if  he  chooses  not  to  continue 
operating  for  the  reason  that  the  decision  of  the  court  is  likely  to  make 
his  venture  unprofitable  and  no  arbitration  court  would  attempt  to 
punish  him  for  this.  While  it  is  true  on  the  other  hand  that  the  court 
can  not  compel  the  members  of  a  union  to  work  if  they  choose  not  to 
work,  the  court  can  penalize  them  for  collectively  quitting  work  in  order 
to  evade  the  award.  Instances  were  brought  to  my  notice  where  the 
Wellington  union,  the  Waihi  gold  miners,  and  the  federated  seamen  went 
on  Avith  their  work  despite  the  fact  that  they  considered  the  court  award 
hostile  to  them. 


NEW  ZEALAND.  131 

Ample  evidence  was  also  furnished  to  prove  that  the  court  can  and 
has  punished  men  for  striking.  In  the  slaughtermen's  strike  of  1907, 
266  men  were  fined  for  striking  illegally,  and  123  men  paid  their  fines  in 
full.  The  total  amount  collected  in  this  strike  to  date  is  $3,776.  And 
the  end  is  not  yet.  Nearly  two  years  have  elapsed  since  the  strike  took 
place,  but  the  administration  is  unrelenting  in  following1  up  the  fugi- 
tive strikers,  as  will  be  noted  from  the  following  clipping  taken  from 
the  Auckland,  New  Zealand,  Herald  under  date  of  May  14,  1909 : 

THE  SLAUGHTERMEN'S  STRIKE. 
(By  Telegraph — Press  Association.) 

CHRISTCHUBCH,  Thursday. 

Order  for  attachment  of  the  wages  of  two  slaughtermen  who  took  part  in  the 
slaughtermen's  strike  and  failed  to  pay  the  fine  imposed  by  the  arbitration  court 
were  to-day  made  absolute  by  Mr.  Day,  S.M.  In  one  case  the  order  amounted  to  £5 
and  in  the  other  to  £2  10s. 

On  the  other  hand,  the  administration  just  as  readily  brings  the 
defaulting  employer  to  time,  as  may  be  noted  from  the  following  clip- 
ping which,  by  a  striking  coincidence,  appeared  in  the  same  issue  of  the 
same  paper: 

FLAXMILLEBS     TROUBLES. 
(By  Telegraph — Press  Association.) 

PALMERSTON  NORTH,  Thursday. 

The  Department  of  Labor  has  notified  Messrs.  Broad  and  Neaves,  flaxmillers, 
that  it  is  intended  to  take  legal  action  against  them  for  alleged  breaches  of  the 
Manawatu  flaxmill  employees'  award:  (1)  For  dismissing  men  because  they  were 
entitled  to  the  benefits  of  an  award ;  (2)  for  breach  of  the  preference  clause  in 
taking  on  nonunionists  when  unionists  were  available.  The  department  also  pro- 
poses to  apply  to  the  court  for  interpretation  to  test  the  validity  of  contracts  signed 
to  scutch  flax  at  a  lower  rate  than  is  provided  by  the  award.  The  cases  will  be 
heard  by  the  arbitration  court. 

The  Black  Ball  coal  miners'  strike  on  the  west  New  Zealand  coast 
was  a  case  where  the  men  tried  to  evade  the  penalty  imposed  upon 
them  for  illegal  striking.  Their  effects  were  sold  by  the  sheriff.  There 
were,  so  to  speak,  no  bidders  as  the  men  were  determined  to  try  and 
defeat  the  law.  The  entire  effects  of  the  strikers  realized  at  the  sale  but 
$3.00.  The  full  penalty  was,  however,  finally  collected  by  attaching 
the  wages  of  the  individual  workers  and  amounted  to  $1,820. 

The  Wellington  bakers'  union  struck  against  a  court  award  and  lost 
the  strike.  The  union  was  fined  and  paid  a  penalty  of  $485.  So  far  as 
I  could  learn  the  court  has  in  every  instance  enforced  its  awards  against 
the  men. 


DISCOURAGING  THE  INVESTMENT  OF   CAPITAL  UNDER  THE  ACT. 

This  was  another  criticism  frequently  made  against  the  act.  Men, 
I  was  told,  would  not  invest  their  money  where  such  drastic  labor  laws 
prevailed.  Hence  the  growth  of  industry  had  been  checked  to  the 


132  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

injury  of  the  worker  and  the  dominion.  Doubtless  there  have  been 
instances,  possibly  fairly  numerous  ones,  where  men  have  refrained 
from  investing  in  industrial  enterprises  in  New  Zealand  because  of 
its  labor  laws.  If  so,  New  Zealand  has  not  a  monopoly  of  this  experience. 
England  has  no  legal  minimum  wage  nor  has  it  a  compulsory  arbitra- 
tion law,  yet  the  same  complaint  on  a  far  greater  scale  is  made  there, 
as  is  evidenced  by  the  following  statement  quoted  by  Secretary  Broad- 
head,  of  the  Christchurch  Employers'  Association. 

THE    WANT   OF    CONFIDENCE. 

In  a  recent  speech  in  the  House  of  Lords,  Lord  Cromer  referred  to  the  present 
want  of  confidence  in  Great  Britain.  He  said  there  never  was  a  larger  amount  of 
capital  in  the  country  to  be  invested.  Among  competent  authorities  the  lowest 
estimate  was  £250,000,000  ($1,200,000,000)  a  year,  and  yet  that  vast  accumulation 
of  capital  was  not  invested  in  industrial  concerns  in  the  country.  Mr.  Haldane,  a 
member  of  the  British  Cabinet,  when  speaking  a  few  months  ago,  declared  his  con- 
viction that  at  the  root  of  future  British  prosperity  lay  the  question  whether  they 
could  hold  their  own  in  the  scales  of  nations.  At  that  moment  he  said  there  was 
plenty  of  capital  available,  had  the  people  only  confidence. 

How  often  do  we  hear  men  of  means  in  our  own  State  of  California, 
as  well  as  in  other  states  of  the  union,  say  that  they  would  not  think 
of  putting  money  in  to  any  enterprise  requiring  much  labor,  because 
of  the  alleged  tyranny  and  despotism  of  labor  unions.  And  yet,  we 
have  no  legal  minimum  wage  nor  compulsory  arbitration  laws  in  our 
country. 

That  there  has  been  material  growth  in  New  Zealand  industries  since 
1901  is  demonstrated  by  the  following  figures  taken  from  the  New 
Zealand  Yearbook  for  1908 : 

Value  of  land,  machin-    Hands 

ery  and  buildings,     employed.  Output. 

1901 — .     £8,408,564            46,847  £17,853,133 

1905 12,509,286            56,359  23,444,235 

The  same  Yearbook,  page  522,  gives  the  bank  deposits  for  1880  as 
£18  per  head  of  the  mean  population,  and  £19.92  per  head  in  1890, 
and  £20.39  in  1900,  and  £25.59  per  head  in  1907. 

Secretary  of  Labor  Tregear  made  the  statement  that  private  wealth 
in  New  Zealand  rose  from  £170,000,000  in  1896  to  £304,654,000  in  1906. 
"A  pretty  good  rise  in  ten  years,"  Secretary  Tregear  adds,  "for  a 
place  where  capital  is  being  driven  away."  In  this  he  quotes  the 
figures  shown  on  page  537  of  1908  Yearbook. 

THE  EFFECT  OF  THE  ACT  ON  IMPORTS. 

Another  criticism  made  against  the  act  is  that  it  has  increased  imports 
out  of  proportion  to  the  home  production.  There  is  no  doubt  that 
imports,  as  a  rule,  have  grown  faster  than  factory  products  in  New 
Zealand.  The  cause,  however,  so  far  as  I  could  ascertain  has  little  to 


NEW  ZEALAND.  133 

do  with  the  act.  The  reasons  for  this  growing  difference  between 
imports  and  home  production  vary  in  different  industries.  In  the 
products  of  steel  and  iron,  where  this  gap  is  quite  noticeable,  the  point 
was  made  by  an  ironmaster,  who  is  most  unfriendly  to  the  act,  that 
after  visiting  the  United  States  a  year  or  two  ago  and  inspecting  some 
of  the  colossal  machine  works  of  that  country  where  they  specialize  on 
a  very  few  things  and  grind  them  out  by  the  tens  of  thousands,  he 
realized  how  impossible  it  is,  even  in  the  face  of  a  fairly  high  tariff, 
for  the  New  Zealand  ironmaster  successfully  to  compete  with  those 
conditions. 

In  the  course  of  my  investigations  I  met  several  manufacturers  who 
assured  me  that  since  the  introduction  of  the  act  the  manufacturing 
end  of  their  business  had  declined  and  their  imports  had  increased, 
notably  in  machinery,  textile  fabrics,  and  wearing  apparel.  This  is 
made  very  plain  by  the  following  figures  quoted  by  Secretary  Broadhead 
of  the  Christchurch  Employers'  Association  and  taken  from  the  New 
Zealand  Yearbooks  of  1895  and  1905. 

Tables  showing  total  value  of  importations  of  three  important  manu- 
factures for  the  years  1895  and  1905,  the  value  of  similar  goods  manu- 
factured in  New  Zealand,  and  the  percentage  of  increase  in  importations 
since  1895,  as  compared  with  the  percentage  of  increase  of  New  Zealand 

manufactures : 

IMPORTS. 

Goods.                                                        1895.  1905.  Increase. 

Boots  and  shoes £127,985  £300,134  £172,149        134  per  cent. 

Woolens  254,580  479,986  225,406          88  per  cent. 

Machinery     (including     agricul- 
tural implements)   258,799  768,550  509,751         190  per  cent. 

NEW  ZEALAND  MANUFACTURES. 
Goods.  1895.  1905.  Increase. 

Boots  and  shoes £357,806        £501,065         £143,259          39  per  cent. 

Woolens  302,423          397,348  94,925  31  per  cent. 

Machinery  and  implements 102,054  199,741  97,687  95  per  cent. 

It  will  be  seen  from  above  that  the  excess  per  cent  of  importations 
local  manufactures  in  1905,  as  compared  with  1895,  was  as  follows : 

Boots  and  shoes __. 95  per  cent. 

Woolens  57  per  cent. 

Machinery  and  implements 95  per  cent. 

I  am  of  the  opinion  as  the  result  of  my  investigations,  that  had  there 
been  no  act,  substantially  the  same  results  would  have  followed.  New 
Zealand  can  never  within  reason  hope  to  become  a  great  industrial 
country.  Her  possible  market  is  too  limited  to  permit  her  to  specialize 
on  a  sufficiently  large  scale  successfully  to  compete  with  the  world's 
great  industrial  centers.  Only  by  putting  on  a  burdensome  and  pro- 
hibitive tariff  can  she  hope  to  keep  out  foreign  manufactures.  Such  pro- 


134  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

hibitive  tariff  would  largely  defeat  its  purpose  by  so  greatly  raising 
the  price  of  things  as  to  limit  the  demand.  The  great  increase  in 
the  import  of  woolens  is  largely  due  to  the  years  of  great  prosperity 
which  materially  increased  the  purchasing  power  of  the  people  and 
created  a  demand  for  finer  and  more  fashionable  goods  than  can  be 
satisfactorily  produced  in  New  Zealand.  Most  retail  dealers  want 
exclusive  styles,  such  as  the  home  manufacturer  is  not  in  a  position  to 
give,  hence  orders  are  sent  abroad  in  preference.  To  illustrate,  in 
speaking  with  the  leading  merchant  tailor  of  one  of  the  New  Zealand 
cities,  I  asked  whether  New  Zealand  produced  a  good  quality  of  wool- 
ens; he  replied  that  it  did.  "Are  the  prices  reasonable?"  I  further 
inquired.  "Quite  so,"  he  assured  me.  "I  presume,  then,  that  you 
confine  your  purchases  of  woolens  altogether  to  New  Zealand  pro- 
ductions, ' '  I  ventured.  ' '  Not  at  all. ' '  he  replied.  ; '  Most  of  my  woolens 
are  imported  from  England  and  elsewhere."  Expressing  my  surprise 
at  this  statement,  he  explained  that  if  he  confined  himself  to  New 
Zealand  woolens,  he  would,  so  to  speak,  be  eating  out  of  the  same  pan 
with  his  competitors.  Whereas,  in  his  business,  it  was  very  important 
that  he  should  be  able  to  show  designs  not  obtainable  elsewhere.  To 
enjoy  this  advantage  he  must  buy  abroad,  where  the  assortments  were 
so  varied  that  he  could  get  exclusive  patterns.  Yet  another  illustra- 
tion. In  speaking  with  a  prominent  New  Zealand  shoe  manufacturer, 
I  asked  if  the  act  was  responsible  for  the  fact  that  the  local  manufac- 
turing of  shoes  had  not  kept  pace  with  imports.  He  answered,  saying 
"the  act  had  nothing  to  do  with  it.  It  is  this  way,"  he  went  on. 
"Despite  the  fact  that  we  have  one  of  the  largest  shoemaking  plants 
in  the  dominion,  we  can  not  in  many  lines,  even  with  the  protective 
tariff,  compete  with  American  or  European  specialty  manufacturers. 
Why,  in  your  country  I  have  been  in  factories  where  thousands  of 
hands  are  employed  making  nothing  else  but  shoes  to  be  retailed  at 
three  dollars  a  pair.  How  can  we  hope  to  compete  with  such  condi- 
tions, in  the  face  of  our  limited  market,  which  compels  us  in  our  one 
factory  to  make  everything  from  a  baby's  shoe  to  a  plough  shoe? 
Furthermore,  we  are  faced  by  this  insurmountable  condition.  A  local 
dealer  will  agree  to  give  us  an  order  if  we  will  promise  to  give  him  the 
exclusive  sale  of  a  particular  last  for  his  city,  explaining  that  other- 
wise he  would  be  thrown  into  competition  with  his  next  door  neighbor 
or  his  other  competitor  on  the  opposite  side  of  the  street,  which  would 
mean  that  his  profits  would  soon  be  cut  to  pieces.  When  we  explain 
that  his  output  at  best  is  too  limited  to  justify  us  in  confining  our  sales 
for  the  whole  city  to  him  alone,  because  that  would  mean  still  further 
minimizing  our  limited  market,  he,  as  a  rule,  declines  to  place  the  order 
and  gives  it  instead  to  the  representative  of  some  foreign  manufacturer, 


135 

has  n  world-wide  market  and  whose  variety  of  lasts  is  so  broad, 
that  he  is  in  a  position  to  give  each  customer  exclusive  styles.  This 
is  a  condition  that  we  can  not  meet  nor  overcome,  and,  as  a  consequence, 
if  you  visit  the  retail  shoe  shops  in  our  cities,  you  will  find  that  eighty 
per  cent  of  the  shoes  on  their  shelves  are  of  foreign  manufacture. 
The  home  factories  are  used  by  the  dealers  to  fill  in  on  sizes  in  transit 
and  for  the  coarser  lines  of  goods. ' ' 

ARE  THE  NEW  ZEALAND  CITIES  AND  TOWNS  GROWING  AT  THE  EXPENSE  OP 

THE    COUNTRY? 

Yes.  This  is  as  true  here  as  it  is  in  most  other  countries.  It  is  not 
clear  to  me  how  the  act  is  responsible  for  this,  unless  it  may  be  held 
that  the  more  favorable  conditions  for  wrorkers  established  by  law  and 
the  higher  wages  that  good  times  have  brought  have  naturally  tended 
to  tempt  the  country  worker  to  seek  these  advantages  in  the  cities. 

The  New  Zealand  government  is  endeavoring  to  counteract  the  ten- 
dency of  the  country  worker  coming  to  the  cities  by  its  settlement 
act,  which  was  created  for  the  purpose  of  encouraging  settlement  on 
the  land.  Premier  Ward  informed  me  that  in  the  last  twelve  months 
the  government  has  advanced  to  agricultural  settlers  nearly  $9,000,000. 

THE  EFFECT  OF  A  LEGAL  MINIMUM  WAGE  ON  NEW  ZEALAND. 

There  are  wide  differences  of  opinion  in  New  Zealand  as  to  the 
Tesult  of  the  legal  minimum  wage.  The  "pros"  and  the  "cons"  on  the 
subject  are  as  opposite  in  their  opinions  as  to  the  effect  of  the  minimum 
wage  as  it  is  possible  for  men  to  make  them.  Here  are  the  views  of  some 
opponents  of  the  idea: 

A  leading  business  man— 

The  minimum  wage  drives  out  the  slow  worker  and  pulls  down  the  efficiency  and 
the  earning  power  of  the  man  above  par. 

A  secretary  of  a  builders '  association— 

Where  a  low  minimum  wage  is  fixed,  as  in  the  grocery  trade,  there  is  room  for 
differentiation  of  wage  on  merit.  But  where  the  minimum  wage  is  high  there  is  no 
such  room,  hence  it  makes  for  the  dead  level  at  the  expense  of  efficiency. 

A  leading  merchant — 

The  minimum  wage  tends  to  leveling  down  process  instead  of  a  leveling  up. 

The  manager  of  a  meat  company— 

If  we  pay  above  the  minimum  wage  the  court  at  the  next  revision  of  the  award 
is  likely  to  make  the  maximum  the  minimum  wage  to  be  paid,  hence  we  can  not 
afford  to  take  this  risk,  and  so  the  minimum  practically  becomes  the  maximum  wage 
Sit  the  expense  of  the  efficient  worker  who  is  thus  kept  down. 

A  manager  of  a  large  transportation  company— 

I  believe  that  the  minimum  wage  makes  for  the  dead  level  and  a  diminishing 
output.  I  pay  my  men  strictly  according  to  the  minimum  wage. 


136  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

A  president  of  an  employers'  association- 
Green  hands,  under  the  legal  minimum  wage,  find  it  very  difficult  to  get  employ- 
ment.    The  poorer  workers  fix  the  standard  of  output  under  the  system ;   the  fast 
workers  are  held  back  by  an  unwritten  law. 

A  building  contractor— 

The  minimum  wage  prevents  many  men  out  of  work,  who  would  be  glad  to  other- 
wise accept  less,  from  getting  employment. 

Attorney  General  Findlay,  in  a  speech  delivered  at  Wellington, 
June  17,  1908- 

Although  the  wage  fixed  by  the  court  is  merely  the  least  the  employer  is  allowed 
to  pay,  it  is  in  general  practice  the  highest  the 'employer  will  pay.  The  result  of 
this  has  been  a  marked  tendency  toward  a  uniform  or  dead  level  wage  in  each  trade, 
for  all  workers  good,  bad  and  indifferent.  I  need  not  dwell  upon  the  evils  of  such 
a  tendency.  It  has  tended  to  deprive  skill,  care  and  industry  of  the  reward  and 
encouragement  essential  to  their  exercise,  and  the  dead  level  wage  tends  to  impress- 
itself  on  the  energy  of  the  worker. 

Here  are  some  views  that  are  quite  the  opposite  to  the  foregoing : 
An  employer  and  ex-member  of  Parliament— 

The  minimum  wage  does  not  make  for  the  dead  level.  A  goodly  percentage  of  the 
men  receive  more  than  the  minimum  wage.  The  dead  level  is  created  only  where 
the  employer  takes  advantage  of  the  legal  minimum  and  reduces  all  his  men  to  that 
level,  regardless  of  their  efficiency.  Few  employers,  however,  are  so  shortsighted. 

A  furniture  manufacturer— 

The  dead  level  of  wages  does  not  exist  in  the  furniture  making  business.  Men  are 
paid  according  to  their  value  regardless  of  the  legal  wage.  But,  of  course,  never 
below  the  legal  rate. 

A  secretary  of  an  employers'  association— 

The  minimum  wage  admittedly  protects  the  fair  against  the  unfair  employer. 

A  business  man— 

The  minimum  wage  is  a  safeguard  against  workers  being  sweated  in  hard  times. 

A  shoe  manufacturer— 

The  minimum  wage  does  not  make  for  the  dead  level  in  the  shoe  manufacturing 
trade.  Men  in  this  trade  are  paid  as  much  above  the  minimum  wage  as  they  can 
make  themselves  worth. 

A  master  baker— 

The  minimum  wage  checks  the  downward  wage  limit  in  bad  times,  but  puts  no- 
limit  on  an  upward  wage  trend  in  good  times. 

A  member  of  Parliament  (Labor  representative)- 

The  fixing  of  a  minimum  wage  does  away  with  sweating,  increases  the  purchasing 
power,  and  has  led  to  the  general  improvement  of  the  worker. 

A  secretary  of  a  labor  union— 

The  legal  minimum  wage  is,  in  my  opinion,  alone  responsible  for  the  increase  in 
wages  among  unskilled  workers.  There  is  never  any  shortage  in  this  class  of  labor, 
and  through  competition  the  tendency  was  toward  a  gradual  lowering  of  conditions 
among  such  wage-earners.  Without  state  intervention  and  the  fixing  of  a  minimum 
wage  many  adults  would  have  been  forced  out  of  the  skilled  trades  and  their  places 
filled  by  youths  and  a  class  of  workers  known  as  "improvers." 


I  NEW  ZEALAND.  137 

It  can  readily  be  seen  how  difficult  it  would  be  for  an  investigator 
from  abroad  to  reach  an  intelligent  conclusion  from  these  widely  con- 
flicting opinions,  all  of  them  I  am  sure  given  in  good  faith  and  express- 
ing the  honest  opinions  of  the  speakers.  There  were  no  facts  available 
to  demonstrate  what  were  the  actual  results  on  the  question  as  to  whether 
or  no  the  minimum  wage  made  for  the  dead  level  of  wage,  and  as  to 
whether  it  was  true  that  the  good  worker  was  discouraged  by  being 
pulled  down  to  the  level  of  the  poor  worker.  From  talking  with 
employers  of  unskilled  workers  I  became  reasonably  satisfied  that  in 
the  unskilled  trades  the  minimum  wage,  as  a  rule,  became  the  maximum 
wage.  This,  however,  I  could  readily  understand  from  the  fact  that 
the  legal  minimum  fixed  by  New  Zealand  law  is,  so  far  as  I  know,  the 
highest  average  wage  paid  in  the  world  for  unskilled  labor.  The  rate 
being  about  two  dollars  a  day  or  an  average  of  twenty-four  cents  an 
hour,  against  an  average  in  the  United  States  of  nine  cents  an  hour 
for  general  laborers  and  twenty-eight  cents  an  hour  for  building 
laborers  or  a  general  average  for  both  of  sixteen  and  one  half  cents 
an  hour. 

I  also  became  reasonably  satisfied  that  the  minimum  became,  as  a 
rule,  the  maximum  wage  in  the  shipping  trades  and  on  street  car  lines. 
In  the  case  of  the  latter  employment,  however,  the  law  provides  an 
increasing  scale  based  on  years  of  service. 

I  further  became  fairly  well  satisfied  that  in  the  building  trades  a  very 
large  proportion,  say,  seventy-five  per  cent  of  the  workers,  received  the 
minimum  wage.  The  very  conflicting  opinions  as  to  factory  wages 
made  it  impossible  to  reach  an  intelligent  conclusion  in  that  direction. 
In  my  perplexity  I  appealed  to  the  Secretary  of  Labor,  Edw.  Tregear, 
who  kindly  offered  to  have  the  factory  schedules  on  file  in  his  depart- 
ment, which  give  the  number  of  factory  employees,  the  wage  fixed  by 
law  and  the  actual  wage  paid,  compiled,  so  that  the  actual  facts  would 
be  made  available.  The  following  results  were  a  revelation  to  all  inter- 
ested parties : 

DEPARTMENT  OF  LABOR,  WELLINGTON,  20th  May,  1909. 
Dear  Colonel  Weinstock. 

In  respect  to  the  figures  which  we  are  getting  out  in  regard  to  the  payment  of  the 
minimum  wage,  I  may  say  that  the  following  totals  have  been  ascertained  for  the 
four  chief  centers  of  New  Zealand  : 

AUCKLAND    CITY. 

Total  number  of  employees,  excluding  underrate  workers  and  young  persons. _  2,458 

Number  receiving  the  minimum  wage 948 

Number  receiving  in  excess  of  the  minimum 1,510 

Per  cent  receiving  in  excess  of  minimum 61 

Trades  not  comparable :  Boat  building,  bread  and  pastry  baking,  brick  and  tile 
manufacturing,  butchers'  small  goods,  flour  milling,  and  freezing  works  employees. 


138  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

WELLINGTON     CITY. 

Total  number  of  employees,  excluding  underrate  workers  and  young  persons. .  2.066 

Number  receiving  the  minimum  wage 876 

Number  receiving  in  excess  of  the  minimum 1,190 

Per  cent  receiving  in  excess  of  minimum 57 

Trades  not  comparable :  Aerated  waters,  bacon  curing,  blacksmithing  and  farriery, 
brass  founding,  bread  and  pastry  baking,  brickmaking,  butchers'  small  goods,  engi- 
neering, fellmongering,  gas  manufacturing,  meat  freezing,  and  wax  vesta  manu- 
facturing. 

CHBISTCHUKCH  CITY. 

Total  number  of  employees,  excluding  underrate  workers  and  young  persons.-  2,788 

Number  receiving  the  minimum  wage 1,127 

Number  receiving  in  excess  of  the  minimum 1,661 

Per  cent  receiving  in  excess  of  minimum 59 

Trades  not  comparable  :  Aerated  waters,  blacksmithing,  bread  and  pastry  baking, 
brewing  and  malting,  butchers'  small  goods,  general  engineering,  flour  milling,  gas 
manufacturing,  and  rope  and  twine  manufacturing. 

DUNEDIN  CITY. 

Total  number  of  employees,  excluding  underrate  workers  and  young  persons..  1,637 

Number  receiving  the  minimum  wage 792 

Number  receiving  in  excess  of  the  minimum 845 

Per  cent  receiving  in  excess  of  minimum 51 

Trades  not  comparable :  Bread  and  pastry  baking,  butchers'  small  goods,  engi- 
neering (all  branches  except  molding  and  boilermaking),  flour  milling,  gas  manu- 
facturing, meat  freezing,  and  sail  and  tent  manufacturing. 

Full  details  of  each  trade  will  be  published  in  the  annual  report  of  the  department, 
which  should  be  ready  about  a  month  hence.  I  thought  these  totals  would  be  suffi- 
cient for  your  purpose  until  the  report  itself  is  issued,  when  (if  you  will  give  me 
your  address)  I  shall  send  you  a  copy. 

The  result  appears  to  me  to  be  very  satisfactory,  showing  as  it  does  that  a 
larger  number  of  employees  receive  above  the  minimum  wage  than  the  minimum 
itself,  in  the  manufacturing  industries  of  New  Zealand. 

Believe  me,  yours  very  faithfully. 

EDW.  TBEGEAE,  Secretary  for  Labor. 

These  facts  make  plain  that  in  the  industries  covered  by  the  fore- 
going advance  report,  over  fifty-eight  per  cent  receive  a  higher  wage 
than  that  fixed  by  law,  thus  exploding  the  criticism  that  in  New  Zealand 
the  minimum  wage  makes,  as  a  rule,  for  the  dead  level,  thereby  pulling 
the  efficient  worker  and  his  wages  down  to  the  level  of  the  poorer  worker. 

No  figures  are  available  at  this  writing  to  show  the  percentage  of 
increase  in  wages  above  the  minimum  received  by  these  fifty-eight 
per  cent  of  factory  workers.  From  data  furnished  by  the  president 
of  the  shoe  manufacturers'  association  of  New  Zealand  I  was  enabled 
to  work  out  this  information  for  the  shoe  industry  and  found  that  it 
averaged  16.4  per  cent.  That  is,  some  shoemakers  receive  as  little  as 
five  per  cent  above  the  minimum  and  some  as  high  as  fifty  per  cent  above 
said  minimum.  The  average  for  all  being  as  stated  16.4  per  cent. 

It  must,  therefore,  be  evident  that  in  the  manufacturing  enterprises 


NEW  ZEALAND.  139 

in  New  Zealand  the  merit  system  largely  prevails,  and  while  the  employer 
under  the  law  can  not  pay  less  than  the  legal  wage,  many  pay  above 
the  legal  wage,  thus  holding  out  a  strong  incentive  for  higher  efficiency. 

HAS   THE   ACT    INCREASED  THE   TAX  BURDENS   OF   THE   PEOPLE? 

Critics  of  the  New  Zealand  act  take  much  satisfaction  in  pointing 
to  the  seemingly  abnormal  increase  in  the  debt  of  the  dominion  since 
the  creation  of  the  act  in  1894  and  maintain  that  this  is  due  to  the 
desperate  efforts  of  the  administration  to  create  public  work  in  order 
to  relieve  the  labor  market  of  unemployed  so  that  the  wages  fixed  by 
the  awards  might  be  successfully  maintained.  These  critics  call  atten- 
tion to  the  fact  that  in  1894  the  dominion  debt  was  £38,000,000  or  a 
per  capita  debt  of  £57  8s.  lOd.  ($278.57),  whereas  in  1908  the  debt  of 
the  dominion  had  grown  to  £66,000,000  or  a  per  capita  debt  of  £66 
($320) .  I  took  pains  to  have  these  statements  analyzed  with  the  follow- 
ing results :  I  found  that  in  1894  out  of  the  debt  of  £38,000,000  there 
was  invested  in  productive  works  £17,162,000  leaving  a  non-productive 
debt  of  £21,838,896  ($105,914,300)  on  which  the  people  had  to  pay 
interest,  whereas  in  1908  the  investment  in  productive  works  aggre- 
gated £47,416,743  leaving  a  non-productive  debt  of  £19,047,154 
($92,378,697).  So  that  as  a  matter  of  fact  the  debt  on  which  the 
people  have  to  pay  interest  had,  in  the  intervening  years  diminished 
by  $13,535,603.  The  productive  investments  yield  the  dominion  an 
income  of  from  three  to  seven  and  one  half  per  cent  and  go  a  good  way 
toward  lightening  the  tax  burdens  in  other  directions. 

Following  are  the  productive  investments  for  the  two  foregoing 
periods  as  furnished  by  Colonel  Collins  of  the  treasury  department 
at  Wellington: 

1894.  1908. 

Railways  £14,600,000  £27,000,000 

Advance  to  settlers  4,100,000 

Advance  to  workers 205,000 

State  lands  1,300,000  5,890,000 

Advances  to  municipal  bodies 2,881,000 

Bank  of  New  Zealand 500,000 

Coal  mines  10,000  100,000 

Telegraph  and  telephone 680,000  1,196,000 

Cash  on  deposit  in  London  . 114,743 

Water  works,  gold  mines  572,000  815,000 

Cash  on  hand 1,015,000 

Reserve  fund  securities  865,000 

New  Zealand  consuls  478,000 

Land  purchases  2,247,000 


£17,162,000  £49,406,743 

($83,236,700)      ($229,922,704) 


140  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

CONCLUSIONS. 

Before  beginning  my  investigations  of  the  operation  of  the  New 
Zealand  act,  I  compiled  a  statement  of  all  the  adverse  criticisms  that 
had  come  to  me  from  various  sources  in  and  out  of  New  Zealand. 

I  then  undertook  the  task  to  verify  and  analyze  these  adverse  com- 
ments, which  in  brief  were  as  follows : 

The  act  has  made — 

(a)  For  an  abnormal  increase  in  wages; 

(&)  For  an  increased  cost  of  living; 

( c )  For  friction  between  employers  and  their  men ; 

(d)  For  diminished  efficiency  on  the  part  of  workers; 

(e)  For  lessened  output; 
(/)  For  increased  taxes ; 

(g)  For  increased  imports  out  of  proportion  to  home  manufacture ; 

(h)  For  driving  capital  away  from  investment  in  industrial  under- 
takings ; 

(i)  For  a  refusal  on  the  part  of  the  workers  to  abide  by  unfavorable 
court  decisions; 

(j)  For  penalties  against  the  men  for  violations  of  awards,  which 
the  court  can  not  enforce. 

These  criticisms  looked  most  formidable,  and  if  found  to  be  true  criti- 
cisms, it  must  be  obvious  that  the  law  is  a  serious  detriment  to  the 
dominion  and  sooner  or  later  must  go. 

My  investigations,  however,  forced  on  me  the  conclusions  that  many 
of  these  criticisms  were  unfair  to  the  act  and  held  it  responsible  for 
results  with  which  it  was  in  nowise  related,  as  in  other  parts  of  this 
report  I  have  endeavored  to  point  out. 

Passing  them  in  final  review,  it  must  be  said  that  while  wages  have 
gone  up  in  New  Zealand,  the  act  has  been  responsible  for  putting  up 
wages  almost  entirely  in  the  sweated  industries,  where  the  weak  and 
the  unorganized  were  being  helplessly  exploited  and  where  wages  should 
have  been  put  up. 

In  other  branches  of  trade,  the  act  has  had  very  little  effect  on  the 
upward  trend  of  wages  which  had  risen  the  world  over,  and  which 
would  have  risen  in  New  Zealand,  act  or  no  act,  because  of  great  pros- 
perity and  a  greatly  increased  demand  for  labor. 

Cost  of  living  would  likewise  have  gone  up,  act  or  no  act,  because  of 
the  greatly  enhanced  world  price  for  all  agricultural  staples  and  the 
abnormal  advance  in  city  land  which  materially  increased  rents. 
There  is  some  friction  between  employers  and  men  but  not  nearly  so 
much  as  is  to  be  found  in  countries  where  strikes  and  lockouts  prevail 
and  cause  endless  strife  and  bitterness  that  leave  scars  behind  for 
indefinite  periods. 


NEW  ZEALAND.  141 

The  government  reports  show  a  diminished  efficiency  of  about  twelve 
per  cent  in  the  last  several  years  on  the  part  of  the  New  Zealand 
workers.  If  New  Zealand  was  the  only  country  in  the  world  where 
this  condition  prevailed  it  might  be  laid  at  the  doors  of  the  act.  The 
fact,  however,  remains  that  a  diminishing  efficiency  is  a  universal 
complaint  through  Europe  and  even  the  United  States  is  not  free 
from  this  complaint.  Hence,  this  evil  can  not  justly  be  laid  to  the 
act.  If  there  is  a  cry  to  "go  slow"  among  the  New  Zealand  workers, 
it  is  done  quietly  and  secretly,  whereas  throughout  Europe  the  cry 
of  diminishing  output  is  shouted,  so  to  speak,  from  the  house  tops. 
Wherever  socialism  in  Europe  has  made  itself  felt,  and  it  has  achieved 
this  in  most  all  continental  industrial  countries,  where  ninety  per  cent 
of  the  organized  wage-earners,  are  members  of  the  Social  Democratic 
party,  there  you  hear  the  cry  sent  forth,  loud  and  deep  and  burnt  into 
the  hearts  of  the  workers  that  it  is  a  crime  against  labor  for  the  worker 
to  put  forth  his  best.  The  Socialist  proclaims  aloud  to  the  wage-earner 
in  those  countries  that  he  should  practice  a  diminishing  output,  first, 
because  it  means  more  work  for  more  hands;  secondly,  because  under 
the  capitalistic  system,  the  worker,  at  best,  gets  a  small  wage,  and  that 
a  small  wage  is  entitled  only  to  a  small  return,  and  finally,  because  a 
diminishing  output  means  crippling  the  profits  of  capital  and  thus 
hastening  the  day  when  capital  will  be  wiped  out  and  socialism  placed 
in  the  saddle.  Wherever  a  diminishing  output  is  met  with  in  New  Zea- 
land, it  can  far  more  readily  be  traced  to  the  preachments  of  such  Social- 
ists as  have  found  their  way  to  New  Zealand  than  to  any  influence  of 
the  act. 

One  of  the  bitterest  opponents  and  critics  of  the  act  is  J.  MacGregor, 
M.A.  of  Dunedin,  New  Zealand.  In  a  pamphlet  published  by  him  in 
1902,  under  the  title  of  "Industrial  Arbitration  in  New  Zealand.  Is 
it  a  Success?"  he  pronounces  the  act  a  dismal  failure,  and  dwells 
particularly  on  the  point  that  it  makes  for  a  saddening  degree  of  dimin- 
ishing efficiency  on  the  part  of  the  wrorkers,  and  he  makes  a  plea  therein 
for  voluntary  arbitration  as  being  infinitely  better  in  its  effects  on 
worker,  employer,  and  community  than  compulsory  arbitration. 

Unwittingly,  however,  he  quotes  the  following  illustration  of  an 
incident  said  to  have  happened  in  England,  where  voluntary  arbitra- 
tion is  depended  on  for  the  settlement  of  labor  disputes  and  where 
neither  the  legal  minimum  wage  nor  compulsory  arbitration  is  on  the 
statute  books.  This  incident  shows  how  much  greater  must  be  the 
degree  of  diminishing  efficiency  and  lessened  output  in  England, 
despite  the  absence  of  the  laws  Mr.  MacGregor  complains  of,  than  in 
New  Zealand:  "Sir  Hiram  Maxim  gave  an  instance  of  a  small  gun 
attachment  which  the  labor  union  committee  classified  as  a  day  and 


142  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

a  quarter  job.  He  invented  a  machine  to  make  it,  but  the  men  would 
produce  the  piece  in  a  day  and  a  quarter  even  with  the  machine.  He 
then  hired  a  German  workman  who  easily  produced  thirteen  pieces  a 
day." 

I  think  I  have  shown  conclusively  by  the  figures  furnished  by  the 
treasury  department  of  New  Zealand,  that  the  tax  burdens  have 
decreased  rather  than  increased  since  the  act  has  been  created.  I  hope 
I  have  also  made  it  plain,  in  an  earlier  part  of  this  report,  that  if 
home  production  has  not  kept  pace  with  imports  it  is  due  to  causes 
other  than  the  creation  of  the  act. 

The  New  Zealand  government  reports  show  clearly  that  capital  has 
had  sufficient  confidence  in  New  Zealand  and  its  labor  legislation  to 
increase  its  investment  industrially  in  that  dominion  nearly  fifty  per 
cent  in  the  five  years  from  1901  to  1905,  and  that  private  wealth 
increased  from  1896  to  1906  over  seventy-eight  per  cent.  The  records 
further  show  that  since  the  new  amendments  of  1908  have  come  into 
force,  men  have  generally  obeyed  the  awards  of  the  court  and  that 
where  they  have  failed  to  do  so,  the  court  has  been  able  to  inflict  and 
to  enforce  penalties. 

Unfriendly  critics  are  fearful  lest  in  bad  times  when  wages  are  cut 
by  the  court  the  men  will  not  yield  and  strikes  will  follow.  The  answer 
to  this  contention  is  that  for  the  past  eighteen  months  New  Zealand, 
in  common  with  the  rest  of  the  world,  has  undergone  a  period  of  more 
or  less  severe  depression  that  has  been  keenly  felt,  industrially  and 
commercially.  This  is  pointed  out  in  the  latest  report  of  the  Welling- 
ton Chamber  of  Commerce,  where  attention  is  called  to  the  fact  that 
in  consequence  of  the  financial  collapse  in  the  United  States  in  the 
fall  of  1907,  the  New  Zealand  exports  for  the  year  1908  declined  eighteen 
per  cent.  Just  enough  to  take  the  "velvet"  out  of  profits  generally 
and  has  brought  to  New  Zealand  consequent  hard  times.  Yet  despite 
these  hard  times  the  court  has  not  cut  wages  in  any  of  the  industries 
whose  awards  in  the  intervening  months  have  come  up  for  revision, 
because  of  the  fact  that  in  good  times  the  court  has  not  fixed  wages  in 
accordance  with  the  large  profits  earned  by  employers,  but  rather  on  the 
basis  of  the  cost  of  living,  and  so  in  bad  times  it  declines  to  consider 
diminished  profits,  but  continues  to  take  the  cost  of  living  as  a  basis. 
Should  hard  times  continue  long  enough  to  bring  about  a  material  reduc- 
tion in  the  cost  of  living,  only  then  is  the  court  likely  to  consider  the 
necessity  of  cutting  wages  correspondingly.  The  question  remains,  Avhen 
that  extreme  condition  is  reached  whether  the  men  will  submit  without 
resort  to  strike.  My  opinion  is  that  the  time  will  never  be  at  hand 
when  it  will  be  possible  to  guarantee  that  there  will  be  no  strikes  in 
New  Zealand  or  elsewhere.  But  I  venture  the  opinion  that  with  the 


NEW  ZEALAND.  143 

restraining  influences  created  by  the  revised  New  Zealand  laws  of 
1908,  strikes,  even  in  the  hardest  times,  will  be  fewer  than  ever  before 
in  that  dominion. 

Mine  was  the  interesting  experience  of  pointing  out  to  the  severest 
New  Zealand  critics  of  the  act  the  fact  that  they  were  permitted  to 
enjoy  a  degree  of  industrial  peace  •  unknown  in  Europe  or  America, 
where  workers  may  legally  strike  and  employers  legally  lockout,  for 
any  cause  or  for  no  cause. 

Despite  the  fact  that  for  general  intelligence  and  all  round  ability 
the  New  Zealander  will  compare  favorably  with  any  set  of  men  I  have 
met  in  all  my  travels,  he  did  not  seem  to  be  well  informed  on  existing 
industrial  conditions  in  other  countries.  When  these  were  pointed 
out  to  him  they  seemed  a  revelation,  and  out  of  the  scores  of  those  I 
interviewed,  I  do  not  recall  one  who  was  finally  willing  to  consent  to 
exchange  the  industrial  conditions  of  New  Zealand  under  its  labor  laws 
with  those  prevailing  in  Europe  or  America. 

Many  who  in  the  beginning  of  the  interview  were  most  bitter  in  their 
denunciation  of  the  act  were  in  the  end  frank  enough  to  admit  that  they 
had  condemned  it  out  of  their  ignorance  of  the  unfortunate  industrial 
conditions  existing  in  the  outside  world,  where  the  state  does  not  inter- 
vene in  industrial  disputes,  and  they  acknowledged  that  they  had  not 
sufficiently  appreciated  the  industrial  advantages  that  the  act  had 
brought  with  it. 

I  can  not  better  conclude  this  report  than  with  the  editorial  pub- 
lished in  the  Wellington  Evening  Post  of  April  15.  1909,  dealing  with 
a  paper  read  the  preceding  day  before  the  Chamber  of  Commerce  in 
that  city  by  Secretary  Broadhead  of  the  Christchurch  Employers' 
Association  in  which  he  roundly  condemned  the  act : 

Mr.  H.  Broadhead,  secretary  of  the  Canterbury  Employers'  Association,  took  rather 
a  gloomy  view  in  the  paper  which  he  read  to  the  delegates  of  Chambers  of  Com- 
merce yesterday.  "Does  the  Arbitration  Act  Hinder  Industrial  Progress?"  was  the 
text  of  the  address,  and  by  a  course  of  reasoning,  peculiar  and  very  controversial 
in  parts,  the  speaker  arrived  at  the  answer  "Yes."  The  conference  thanked  him  for 
his  thesis,  but  did  not  commit  itself  to  any  approval  or  disapproval  of  the  pessimistic 
doctrine.  Practically,  the  arguments  remain  the  opinions  of  one  delegate,  and  are 
consequently  robbed  of  much  of  their  importance.  It  seems  evident  that  Mr.  Broad- 
head  has  confused  the  purpose  of  the  industrial  legislation  with  mistakes  and 
weakness  in  the  administration.  We  have  repeatedly  contended,  and  we  repeat  that 
contention  now,  that  notwithstanding  recent  occurrences,  the  arbitration  law  is  as 
good  and  useful  as  ever  it  was.  All  the  disputes  and  all  the  strikes  are  trifling  in 
comparison  with  the  real  and  lasting  good  that  the  law  has  done  during  a  dozen 
years  in  founding  and  consolidating  industry.  It  was  not  the  act,  but  the  admin- 
istration of  the  act,  that  broke  down.  Must  a  good  machine  be  smashed  because  an 
engineer  does  not  appreciate  the  difference  between  a  "governor''  and  a  "crank?" 
Mr.  Broadhead,  in  effect,  suggests  a  reversion  to  the  old  order.  We  are  sure, 
however,  that  if  the  issue  was  put  straight  out  to  the  employers  of  New  Zealand 
an  appreciable  majority  would  vote  against  a  retrogression  to  the  regime  of  the  old 
days  before  the  mind  of  the  Hon.  W.  P.  Reeves  saw  a  way  leading  towards  peace. 


144  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

The  spirit  of  this  legislation  is  calculated  to  go  for  the  benefits,  not  of  any  one  class, 
but  the  welfare  of  New  Zealand  as  a  whole.  Employers,  of  course,  have  approved 
the  theory,  but  some  have  complained  at  the  effect  of  the  practice.  Yet  they  must 
remember  that  the  sorrow  which  came  to  them  was  rather  due  to  the  weakness  and 
timidity  of  the  administration  than  to  the  law,  though  the  law  may  not  have  been 
perfect. 

The  amendments  enacted  by  Parliament  in  1908  have  removed  from 
the  act  the  chief  objections  pointed  out  by  its  critics.  Since  these 
amendments  have  gone  into  operation,  early  this  year,  a  much  better 
feeling  has  prevailed  between  such  employers  and  workers  as  have  since 
had  occasion  to  renew  their  demands  or  to  adjust  differences.  The 
industrial  peace  enjoyed  throughout  New  Zealand  during  the  past  year 
promises  now  to  be  the  normal  condition  of  the  future,  with  every 
probability  that  New  Zealand  will  actually  become  "a  country  without 
strikes. ' ' 


CONCLUSIONS  AND  RECOMMENDATIONS.  145 


CONCLUSIONS  AND  RECOMMENDATIONS. 


At  this  point  I  desire  to  express  to  your  Excellency  my  appreciation 
for  the  honor  conferred  in  issuing  to  me  the  commission  to  investigate 
the  labor  laws  and  the  labor  conditions  of  foreign  countries,  and  to 
report  to  you  as  the  Chief  Executive  of  the  State. 

The  work  has  been  to  me  in  the  nature  of  a  rare  educational  oppor- 
tunity. It  has  brought  me  in  touch  with  many  men  in  many  lands 
whom  it  was  a  pleasure  and  a  privilege  to  meet  and  whom  I  wish  through 
this  medium  to  thank  for  the  many  courtesies  extended  and  the  valuable 
information  so  cheerfully  furnished. 

For  obvious  reasons  I  can  not  give  the  names  of  all  who  rendered  me 
assistance,  but  I  shall  ever  retain  in  grateful  remembrance  the  many 
acts  of  kindness  and  the  courtesy  shown  me  throughout  my  long  and 
varied  journeyings  in  quest  of  information,  by  men  in  various  walks  of 
life,  voicing  widely  different  points  of  view. 

I  found  that  in  most  countries  the  labor  problem  is  regarded  as  one 
of  the  great  problems  of  the  day.  It  is  commanding  the  best  thought 
of  many  of  the  world's  best  minds. 

Statesmen,  great  captains  of  industry,  political  economists,  labor 
leaders,  journalists  and  humanitarians,  the  world  over  are  earnestly 
striving  to  better  the  condition  of  the  wage-earner  and  his  dependents 
and  to  find  a  way  peacefully  to  settle  the  inevitable  disputes  constantly 
arising  between  employers  and  employees  and  likely  to  continue  to  arise. 

That  the  labor  problem  is  commanding  the  attention  of  many  of  the 
world 's  best  minds,  speaks  well  for  the  wage-earner  and  well  for  society 
generally.  It  is  not  likely  that  capital,  except  in  isolated  cases,  would 
of  its  own  volition,  have  shortened  hours,  increased  wages  and  improved 
working  conditions,  and  thus  at  least  in  its  own  opinion,  lessened 
profits.  It  therefore  speaks  well  for  organized  labor  that  through  its 
initiative  much  has  been  done  to  bring  about  these  bettered  conditions. 
It  speaks  well  for  society  generally  because,  unless  the  initiative  of  the 
worker  to  better  his  condition  had  been  aided  by  statesmen,  legislators, 
political  economists,  writers,  and  the  more  progressive  and  sympathetic 
employers  backed  by  an  intelligent  public  sentiment  that  had  largely 
been  educated  by  organized  labor,  the  great  betterment  in  the  condition 
of  the  wage-earner  which  in  the  last  decade  or  two  has  taken  place, 
would  not  have  been  possible. 

10 


146  REPORT  OP  SPECIAL  LABOR  COMMISSIONER. 

Much  of  the  wage-earner 's  improved  condition  has  been  brought  about 
through  industrial  war.  In  the  beginning,  the  worker  had  to  battle  to 
command  recognition. 

For  generations  the  employer  had  been  led  to  feel  that  he  was  the  all 
in  all,  in  industrial  matters,  that  the  mere  circumstance  of  his  furnish- 
ing employment  made  him  labor 's  benefactor,  that  it  was  for  him,  wholly 
and  solely,  to  dictate  terms  and  conditions  of  labor,  and  for  labor  grate- 
fully to  accept. 

The  idea  of  the  worker  being  entitled  to  a  voice  in  the  matter  of 
wages,  hours  of  labor,  or  conditions  of  employment,  seemed  to  the 
employer  an  impossible  thought,  and  for  the  worker  even  to  hint  at  such 
a  right  on  his  part  was  regarded  as  a  bit  of  arrogance  and  a  decided 
impertinence  meriting  instant  dismissal.  Conditions,  however,  have 
changed.  Labor  unionism  has  done  much  to  educate  the  employer  to 
the  fact  that  the  worker  is  entitled  to  a  voice  in  all  things  affecting  his 
own  welfare.  Trade  unionism  has  through  hard  fought  battles  involv- 
ing at  times  great  industrial  wars,  with  their  frightful  consequent  suf- 
ferings to  both  sides  and  to  society  generally,  forced  upon  even  the  most 
aristocratic  and  arrogant  among  employers  the  fact  that  it  is  a  power 
to  be  reckoned  with. 

Providence  has  not  given  all  the  virtues  nor  all  the  human  weaknesses 
either  to  the  man  who  pays  or  to  the  man  who  receives  wages.  Both 
being  human  are  likely  in  common  to  have  the  same  virtues  and  the 
same  failings.  And  so,  when  the  employer  believed  himself  the  sole 
arbiter,  he  made,  as  a  rule,  the  most  of  his  opportunities  to  exploit  the 
worker ;  when  in  turn  organized  labor  believed  itself  to  be  in  the  saddle, 
it  followed  the  example  of  the  employer,  and  often  became  just  as 
despotic,  just  as  tyrannical  and  just  as  ready  to  exploit  the  wage-payer. 

So  long  as  industrial  wars  were  petty  in  character  and  involved  but 
few  combatants,  society  generally  felt  little  concerned  in  them,  but  when 
the  tremendous  growth  of  industrialism  in  recent  decades  led  to  colossal 
industrial  wars  that  frequently  affected  the  welfare  of  whole  communi- 
ties and  at  times  of  great  nations,  society,  whether  it  would  or  no,  found 
itself,  as  a  matter  of  self-defense,  obliged  to  take  the  deepest  interest  in 
these  industrial  conflicts  with  the  view  of  preventing  them  if  possible. 

Great  and  mighty  governments  that  in  the  past  looked  upon  the 
manual  worker  as  mere  cattle  in  times  of  peace  and  as  so  much  food  for 
the  enemy's  powder  in  time  of  war,  have  been  compelled  by  his  solidarity 
and  his  aggressive  agitation  to  devote  much  thought  and  attention  to 
the  consideration  and  adjustment  of  his  grievances. 

The  question  then  is,  have  we  not  reached  a  stage  when  industrial  war, 
having  served  its  purpose  in  conunanding  for  organized  labor  its  just 
recognition,  may  be  relegated  to  the  dead  past  1  I  hold  that  the  time  is 


CONCLUSIONS  AND  RECOMMENDATIONS. 


147 


here  when  labor,  and  capital,  may  put  aside  the  munitions  of  industrial 
war,  the  strike  and  the  lockout,  with  their  incalculable  cost  which  is  for- 
ever lost  to  society.  Who  will  oppose  reason  and  equity  taking  the 
place  of  the  brutal  strike  and  the  heartless  lockout,  if,  by  the  recogni- 
tion of  the  organization  of  labor,  a  way  can  be  found  to  insure  the  exer- 
cise of  reason  and  equity  in  the  settlement  of  labor  disputes? 

I  hold  that  the  time  is  ripe  when  the  suffering  and  misery  brought 
upon  untold  numbers  of  innocent  people  by  strikes  and  lockouts  should 
cease. 

I  found  that  men  and  governments  the  world  over  believe  that  such 
a  time  is  here  and  many  among  them  have  been  and  still  are  earnestly 
striving  to  find  a  practicable  and  equitable  way  of  peacefully  settling 
labor  disputes,  so  that  the  strike,  labor's  deplorable  weapon  of  offense 
and  defense,  and  the  lockout,  capital's  equally  deplorable  weapon,  may 
be  safely  laid  aside. 

The  first  governmental  step  along  these  lines  was  the  creation  of 
machinery  that  would  aid  and  encourage  voluntary  arbitration  on  the 
part  of  employers  and  men.  Among  the  countries  who  legislated  along 
these  lines  are  Great  Britain,  France,  Belgium,  The  Netherlands,  Ger- 
many, Austria,  Italy,  and  many  of  our  American  states.  The  results 
have,  however,  been  insignificant  and  disappointing. 

Here  is  a  summary  of  the  net  outcome  for  some  of  these  countries  as 
shown  in  Bulletin  No.  60,  September,  1905,  issued  by  the  Bureau  of 
Labor,  Washington,  D.  C. : 

No.  of  No.  of  state  Per- 

Years.  Country.  strikes.  interventions.       centage. 

1896  to  1903.     Great  Britain  4,952  154  3.11 

1901  to  1904.     Netherlands  529  59  11.15 

1902  -  1903.     Germany  2,636  318  12.06 

1894  to  1902.  Austria   2,390  573  23.97 

1897  to  1899.  Italy  732  .                16  2.18 

1893  to  1903.  France 5,874  1,413  24.05 

1896tol900.  Belgium 610  35  5.74 

17,723  2,568  14.49 

AMERICA. 

No.  of  No.  of  state  Per- 

Years.               State.                                                    strikes.  interventions.  centage. 

1901  to  1904.     Canada  490  33  6.73 

1896  to  1900.     New  York  6,189  390  6.30" 

1886  to  1900.     Massachusetts    2,628  563  21.42 

1893  to  1900.     Ohio 878  103  11.73 

1895  to  1900.     Wisconsin 195  53  27.17 

1897  to  1900.     Indiana  183  82  44.80 

10,563  1,224  11.59 

Europe  .  17,723  2,568  14.49 


Totals  .  -  28,286 


3.972 


14.04 


148  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

The  foregoing  figures  show  that  in  thirteen  European  countries  and 
American  states  where  the  government  had.  created  machinery  for  the 
voluntary  adjustment  of  labor  disputes  such  intervention  had  in  the 
course  of  years  been  applied  in  only  14.04  per  cent  of  cases. 

From  the  only  available  figures  afforded  by  Bulletin  No.  60,  from 
which  the  foregoing  data  are  taken,  to  show  in  how  many  instances  such 
state  intervention  occurred  before  a  strike  or  lockout  took  place,  I  take 
the  following,  figures :  No  of  No  of  state  Per. 

strikes.          interventions.       centage. 

France 5,874  61  1.04 

New  York 6,189  32  0.51 

Massachusetts 2,628  419  15.93 

Ohio   744  13  1.74 

Wisconsin 53  6  11.13 

Indiana 82  2.68 


15,570  533  3.42 

It  is  safe  to  assume  that  if  the  figures  of  the  other  countries  and 
states  were  available,  they  would  show  substantially  the  same  average 
percentage  of  state  interventions  before  cessation  of  work.  These  figures 
must  convince  the  most  pronounced  advocate  of  voluntary  arbitration 
with  or  without  state  intervention  that  it  is  largely  a  failure  the  world 
over,  so  far  as  being  a  prevention  for  strikes  or  lockouts. 

It  is  to  be  deplored  that  this  is  so,  since  the  ideal  way  of  adjusting 
labor  disputes  is  for  both  sides  to  get  together  voluntarily,  in  the  hope 
of  reaching  an  understanding.  Failing  in  this,  then  to  submit  the  dis- 
pute to  a  disinterested  arbitrator  or  arbitrators  and  accept  the  decision. 

However  ideal  this  plan  may  be,  the  world  experience  shows  that  it 
can  not  be  relied  upon  as  a  prevention,  except  in  a  very  trifling  per- 
centage of  cases,  even  when  the  state  assumes  the  task  of  relieving  both 
parties  to  an  industrial  dispute  from  taking  the  initiative. 

The  next  logical  step  for  state  intervention  is  the  one  generally 
adopted  by  the  Australasian  governments,  where  the  state  not  only  com- 
pels the  disputants  to  get  together  but  also  compels  them,  if  they  can 
not  agree  between  themselves,  to  abide  by  the  decision  rendered  by  the 
court.  This  has  led  to  the  colonies  enjoying  the  highest  degree  of  indus- 
trial peace  the  modern  industrial  world  has  seen,  as  evidenced  by  the 
following  number  of  strikes  which  in  the  last  fifteen  years  have  taken 
place  in  the  three  principal  industrial  governments  of  Australasia : 

Victoria   9 

New  South  Wales 186 

New  Zealand  .  25 


Total -  220 

or  an  average  for  the  three  governments  of  less  than  fifteen  strikes  a 
vear.     When  it  is  remembered  that  even  this  insignificant  number  of 


CONCLUSIONS   AND   RECOMMENDATIONS.  1-49 

strikes  was  largely  due  not  to  any  weakness  in  the  principle  of  compul- 
sory state  intervention,  but  to  defects  in  the  administration  of  the  law, 
because  of  inexperience,  the  showing  is  the  most  remarkable  in  modern 
industrial  history. 

With  the  perfected  laws  recently  enacted  as  the  result  of  past 
experience,  the  next  fifteen  years  are  likely  to  show  a  still  more  remark- 
able result  along  the  lines  of  industrial  peace. 

The  Australasian  system  has  proven  the  most  powerful  check  on  the 
greed  of  the  unfair  among  employers  and  the  most  effective  restraint 
against  the  selfish  and  unreasonable  demands  of  the  unscrupulous  among 
labor  unionists,  that  the  legislative  mind  has  ever  devised. 

It  has  protected  the  worthy  wage-earner  against  his  fellowr-worker 
who  was  willing  to  work  for  a  starvation  wage  and  also  against  the  sweat- 
ing employer  who,  if  he  could,  would  compel  him  to  work  for  a  starvation 
wage.  It  has  also  protected  the  worker  from  the  hasty  and  ill-judged 
action  of  well-meaning  but  overzealous  or  hot-headed  labor  leaders  in 
precipitating  strikes  that  to  the  worker  and  his  family  might  spell  ruin 
and  starvation. 

It  has  further  protected  the  wage-earner  from  the  unscrupulous 
among  labor  leaders  who  for  selfish  reasons  might  deliberately,  to  the 
worker's  ruin,  bring  about  unwarranted  strikes.  It  has  protected  the 
fair  employer  from  his  unfair  competitor,  who  by  exploiting  labor 
could  underbid  and  undersell  him  and  in  the  end  compel  him  likewise 
to  become  unfair  to  labor  or  go  out  of  business.  It  has  succeeded  in 
maintaining  the  highest  degree  of  industrial  peace  known  in  modern 
times,  for  the  good  of  the  worker,  employer,  and  the  body  politic.  For 
all  these  reasons  a  fair-minded  inquirer  must  pay  the  highest  tribute  to 
the  Australasian  statesman  in  having  rendered  a  great  service  to  his  own 
people  and  in  having  at  the  same  time  given  the  world  a  valuable  object 
lesson  in  demonstrating  the  importance  and  the  practicability  of  state 
intervention  in  the  settlement  of  labor  disputes. 

Given  the  same  conditions,  I  could  not  serve  my  commonwealth  better 
than  to  recommend  to  it  the  adoption  of  the  Australasian  system  for 
the  settlement  of  labor  disputes  and  the  prevention  of  sweating.  But 
owing  to  widely  different  conditions  I  do  not  see  my  way  clear  to  make 
such  recommendations. 

The  success  of  the  Australasian  labor  laws  is  dependent  primarily 
upon  two  things : 

(a)  The  confidence  of  employer  and  worker  in  the  fairness  of  the 
industrial  court. 

(&)   The  compactness  of  its  industrial  centers. 

The  Australasian  courts  command  confidence  because  their  life  tenure, 
subject  to  good  behavior,  makes  them  independent.  They  are  not  placed 


150  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

in  a  position  where  to  retain  office  they  must  favor  friends  or  punish 
enemies. 

In  the  course  of  my  Australasian  investigations  I  heard  many  criti- 
cisms on  the  judgment  of  the  courts,  but  I  never  heard  the  slightest 
whisper,  even  on  the  part  of  the  severest  critics,  that  reflected  on  the 
honesty  or  the  good  intentions  of  the  court. 

I  believe  that  the  judiciary  of  California  for  honesty  and  integrity 
will  compare  favorably  with  that  of  any  in  the  land ;  the  fact  remains, 
however,  that  under  the  law  our  courts  are  elective  and  being  elective 
this  must  tend  largely  to  destroy  the  absolute  confidence  in  the  court,  so 
essential  in  the  adjustment  of  labor  disputes.  Labor  is  likely  to  contend, 
when  decisions  are  rendered  against  it,  that  the  court  has  been  swayed 
or  bought  up  by  the  power  of  capital ;  and  capital  is  likely  to  feel,  when 
decisions  are  rendered  against  it,  that  the  court  has  been  intimidated 
by  labor,  or  to  get  votes,  has  toadied  to  labor.  Such  an  inevitable  atti- 
tude on  the  part  of  one  side  or  the  other  or  both,  must  in  the  end  cripple 
the  usefulness  of  the  court  and  defeat  the  purpose  of  the  law. 

Furthermore,  the  success  of  the  legal  minimum  wage  and  the  legal 
maximum  hours  of  labor,'  fixed  by  Australasian  courts,  having  in  view 
the  wiping  out  of  sweating,  depends  largely  upon  the  centralization  of 
industry.  In  New  Zealand  the  entire  dominion  is  treated  as  a  unit 
and  the  one  administration  can  regulate  and  control  every  part  of  the 
colony.  Of  the  six  states  of  the  commonwealth  of  Australia,  five  have 
laws  regulating  wages  and  hours  of  labor;  the  sixth  state,  Tasmania, 
has  but  small  industrial  interests. 

Our  country  has  nearly  fifty  States,  each  with  its  sovereign  and  inde- 
pendent right  to  fix  a  legal  minimum  wage  and  maximum  hours  of 
labor.  If  uniform  legislation  among  all  or  most  all  of  the  States  could 
be  enacted  it  might  be  possible  legally  to  kill  sweating.  Otherwise,  such 
legislation  would  simply  mean  driving  the  sweater  from  one  State  across 
the  border  to  some  other. 

For  these  reasons  I  do  not  see  my  way  clear  to  recommend  to  your 
Excellency  the  advocacy  of  the  Australasian  labor  laws  in  their  entirety. 
In  the  interest  of  industrial  peace,  however,  I  do  earnestly  believe  in  the 
adoption  of  the  principle  of  State  intervention  in  labor  disputes  to  the 
fullest  degree  consistent  with  our  conditions  and  with  our  form  of  gov- 
ernment. 

That  some  state  intervention  has  been  deemed  essential  is  shown  by 
the  states  on  our  own  continent  and  the  various  industrial  countries  of 
Europe,  who  in  recent  years  have  created  legal  machinery  for  the  peace- 
ful settlement  of  labor  disputes.  That  such  legal  machinery  has  prac- 
tically failed  is  due  altogether  to  the  fact  that  its  use  was  made 
voluntary  in  character.  For  the  state  to  serve  any  useful  purpose  in 


COXCU  'SIGNS  AND  RECOMMENDATIONS.  151 

such  sphere  of  activity,  it  must  go  a  step  farther  and  follow  as  nearly 
as  its  conditions  will  permit,  the  pioneering  footsteps  of  the  Austral- 
asian colonies.  I  had  practically  reached  this  conclusion  many  months 
ago  while  making  my  investigations  in  Europe. 

The  contact  with  many  of  Europe's  keenest  and  ablest  minds  in  all 
walks  of  life,  who  were  high  authorities  on  labor  problems,  had  crystal- 
lized my  thoughts  on  the  question  as  they  never  could  have  been  crys- 
tallized as  a  mere  student  of  book-knowledge,  or  even  as  a  fairly  large 
employer  of  labor  coming  in  contact  with  men  and  conditions  and 
experiences  only  in  my  own  country. 

I  soon  realized  that  voluntary  arbitration  the  world  over  was  largely 
a  failure,  and  for  the  reasons  already  named  I  also  realized  that  com- 
pulsory arbitration  would  not  fit  the  conditions  of  our  commonwealth. 
My  knowledge  of  conditions  generally  and  my  observations  in  various 
lands  had  forced  upon  me  the  conclusion  that  the  weak  spot  in  the 
adjustment  of  industrial  disputes  was  the  fact  that,  as  a  rule,  the  side 
that  believed  itself  to  be  the  stronger  refused  to  meet  or  to  treat  with 
the  other  side.  If  it  was  labor  that  believed  itself  to  be  the  stronger,  it 
was  likely  to  take  the  position  that  the  employer  must  concede  all  its 
demands  or  none.  When  capital  felt  itself  to  be  the  stronger,  its  answer 
to  all  appeals  for  a  conference  made  by  labor  or  by  voluntary  inter- 
veners  was  to  the  effect  that  it  was  quite  satisfied  with  existing  condi- 
tions and  that  there  was  nothing  to  arbitrate.  And  so  the  struggle 
would  go  on,  the  victory  often  going,  not  necessarily  to  the  one  that  had 
right  and  justice  on  its  side,  but  to  the  one  having  the  longer  purse  or 
the  greater  endurance,  such  victory  often  being  bought  at  a  terrific  cost 
to  the  victor,  to  say  nothing  of  the  disaster  to  the  loser  and  the  injury 
to  the  State. 

The  problem  then  seemed  how  to  compel  the  unreasonable,  the  unfair, 
and  the  stubborn  on  both  sides  to  get  together  in  the  hope  that  by  con- 
ciliation, and,  if  need  be,  by  the  intervention  of  a  third  disinterested 
party,  an  agreement  might  be  reached. 

It  is  generally  conceded  that  public  opinion  is  a  most  important 
factor  in  the  settlement  of  labor  disputes,  more  especially  wrhen  they  are 
of  a  character  likely  to  affect  public  convenience  or  comfort  or  profit. 
It  is  rarely  if  ever  that  a  strike  or  a  lockout  can  succeed  that  has  public 
sentiment  against  it.  The  problem,  however,  has  ever  been  how 
properly  to  enlighten  public  opinion  and  how  to  place  before  it  the 
actual  facts  involved  in  a  labor  dispute  as  found  by  a  disinterested 
inquirer  in  whom  the  public  w^ould  have  confidence.  Bancroft 

"With  these  thoughts  in  mind  it  seemed  to  me  that  an  important  stride 
would  be  made  in  the  direction  of  industrial  peace,  if  legislation  was 
created  calling  for  a  public  inquiry  in  labor  disputes  before  they  had 
reached  the  serious  stage  of  strike  or  lockout. 


152  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

I  realized,  however,  that  any  legislation  along  such  lines,  in  a  country 
such  as  ours,  must  at  best  be  experimental.  While  in  that  stage  I  feel 
that  the  proposed  legislation  should  be  confined  to  disputes  likely  to 
arise  in  the  conduct  of  public  utilities,  since  it  is  strikes  and  lockouts 
in  these  activities  that,  as  a  rule,  more  seriously  affects  the  public  wel- 
fare. Should  the  proposed  legislation  after  a  fair  trial  prove  a  success, 
it  would  then  be  in  the  interest  of  all  concerned  to  broaden  it  so  that  all 
industries  might  be  brought  under  its  influence. 

This  conclusion  having  finally  been  reached  on  my  part,  I  formulated 
it  on  paper  while  in  Brussels,  Belgium,  in  the  nature  of  a  rough  draft 
of  a  proposed  law. 

On  arriving  in  Paris  a  few  days  later  I  found  awaiting  me  there  a 
packet  of  printed  matter  sent  me  by  the  Canadian  Labor  Department 
through  the  courtesy  of  Mr.  Dougherty  of  the  Canadian  Department  of 
Agriculture,  whom  some  months  before  I  had  met  while  in  Rome. 

Looking  over  this  printed  matter,  I  was  surprised  to  find  that  my 
idea  had  been  anticipated  by  the  Deputy  Labor  Minister  of  Canada, 
McKenzie  King,  who  had  recently  formulated  and  had  succeeded  in 
getting  the  Canadian  Parliament  to  pass  a  public  inquiry  act.  My  sat- 
isfaction can  be  understood  when  I  found  among  other  documents  in 
this  collection  the  first  annual  report  just  issued  by  the  Canadian  Labor 
Department  of  the  operation  of  the  Act  which  showed  that  ninety -seven 
per  cent  of  the  labor  disputes  submitted  to  a  public  inquiry  had  been 
amicably  adjusted,  and  that  in  only  three  per  cent  of  cases  inquired  into 
had  there  been  strikes  after  an  award  was  made. 

Here  we  have  a  most  striking  illustration  of  the  difference  in  effect- 
iveness between  voluntary  arbitration  and  public  inquiry.  Under 
VOLUNTARY  ARBITRATION,  having  behind  it  all  the  machinery 
and  influence  of  the  State,  there  are  strikes  and  lockouts  in  about  ninety- 
seven  per  cent  of  cases  and  peaceful  settlement  without  cessation  of  work 
in  about  three  per  cent  of  cases.  Under  PUBLIC  INQUIRY  we  find 
the  very  first  year  of  its  trial  in  Canada,  when  at  best  the  system  could 
not  yet  have  been  perfected,  ninety-seven  per  cent  of  peaceful  settle- 
ments without  cessation  of  work  and  but  three  per  cent  of  strikes.  What- 
ever doubts  or  misgivings  I  may  have  had  as  to  the  desirability  or  the 
practicability  of  the  proposed  public  inquiry  law  were  removed  by  the 
showing  made  by  Canada  as  the  result  of  an  actual  application  of  the 
principle.  Surely,  if  in  California  we  can,  through  the  medium  of  pub- 
lic inquiry  adjust  peacefully  ninety-seven  per  cent  of  labor  disputes,  we 
shall  have  accomplished  a  most  important  work  and  shall  have  come  as- 
near  establishing  industrial  peace  as  under  our  system  of  government 
is  possible. 

Sailing  from  Egypt  to  India,  it  was  my  good  fortune  to  meet  Mr. 


CONCLUSIONS  AND  RECOMMENDATIONS.  153 

McKenzie  King,  the  framer  of  the  Canadian  public  inquiry  act,  to 
whom  I  am  indebted  for  valuable  hints  and  suggestions  embodied  in  the 
following  recommendations,  which  I  have  the  honor  to  submit  herewith 
to  your  Excellency. 

A  BASIS  FOE  A  PROPOSED  LEGISLATIVE  ACT  TO  LESSEN  STRIKES  AND  LOCKOUTS. 

Whereas  labor  can  be  divided  into  two  distinct  classes— 

(a)  That  employed  in  private  enterprise. 

(&)  That  employed  in  public  utilities — a  public  utility  being  under- 
stood to  be  any  undertaking  patronized  by  the  general  public,  for  which 
a  public  franchise  has  been  granted  by  the  state  or  by  the  municipality. 

And  whereas,  the  general  public  is  much  concerned  in  the  continuous 
and  uninterrupted  service  of  said  public  utilities,  and  in  the  event  of  a 
strike  or  lockout,  is  collectively  a  greater  sufferer  than  the  employees  of 
such  public  utility  and  their  employers  combined ;  be  it  therefore 

Resolved,  that  the  following  legislation  be  recommended  to  the  law- 
making  power  for  enactment,  with  the  view  of  bringing  about  peaceful 
settlements  of  labor  disputes  arising  between  employers  and  employees 
engaged  in  said  public  utilities,  in  order  to  prevent  strikes  and  lockouts. 

1.  It  is  hereby  enacted  that  any  public  utility  corporation  or  any 
corporation  or  contractors  doing  contract  work  for  any  city,  county,  or 
for  the  State,  which  shall  have  had  a  dispute  with  their  employees  which 
can  not  be  settled  may,  or  that  shall  have  decided  to  lockout  its  or  their 
employees,  must  before  declaring  such  lockout,  furnish  the  state  labor 
commissioner  with  a  written  statement  to  the  effect  that  it  has  or  they 
have  found  it  impossible  to  have  a  conference  with  its  or  their  employees 
or  their  representatives,  or,  having  had  a  conference  with  said  employees 
or  their  representatives,  an  agreement  has  been  found  impossible.    Said 
statement  must  also  set  forth  the  points  of  existing  differences  to  be 
settled  and  agreed  upon.    Any  body  of  workmen  employed  by  a  public 
utility  corporation,  or  by  any  company  or  contractors  doing  contract 
work  for  any  city  or  county,  or  for  the  State,  which  shall  have  a  dispute 
with  their  employers  which  can  not  be  settled,  may,  or  having  voted  to 
go  on  a  strike,  shall,  before  declaring  such  strike,  furnish  the  state  labor 
commissioner  with  a  written  statement  to  the  effect  that  they  have  been 
unable  to  hold  a  conference  with  their  employers,  or,  having  had  a  con- 
ference, it  has  been  found  impossible  to  agree.     Said  statement  shall 
also  set  forth  the  points  of  existing  differences  to  be  settled  and  agreed 

upon. 

2.  Immediately  on  receipt  of  such  notice,  the  said  labor  commis 
sioner  shall  interview  the  parties  to  the  dispute,  separately,  or  in  his 
discretion,  collectively,  as  mediator  and  conciliator,  with  the  view  of 
bringing  about  an  agreement  between  them.     Failing  in  this,  within 


154  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

three  days  he  shall  notify  both  sides  to  the  dispute  each  to  submit  to 
him  in  writing,  within  three  days,  the  name  of  a  representative  who  is 
or  has  been  engaged  in  the  industry,  and  who  is  willing  and  ready  to 
act  on  a  board  of  inquiry.  These  names  are  to  be  placed  forthwith  by 
the  said  labor  commissioner  in  the  hands  of  the  governor,  who  shall 
appoint  said  nominees. 

3.  In  the  event  of  a  failure  on  the  part  of  either  or  both  parties  to  the 
dispute  to  conform  to  the  above  provision  within  the  specified  time,  the 
labor  commissioner  shall  notify  the  governor  of  such  failure,  whereupon 
the  governor  shall  appoint  within  three  days  a  representative  or  repre- 
sentatives of  his  own  choice,  for  said  party  or  parties,  who  has  or  have 
been  engaged  in  the  industry. 

4.  These  two  representatives  of  the  parties  to  the  dispute  shall  meet 
immediately  after  their  appointment,  and  shall  proceed  to  elect  a  third 
party  as  chairman  of  said  board  of  inquiry.    Having  chosen  a  chairman, 
such  party  shall  be  appointed  chairman  of  the  board  of  inquiry  by  the 
governor.    In  the  event  of  the  two  representatives  being  unable  to  agree 
upon  a  third  party  as  chairman  within  three  days,  they  shall  notify  the 
governor  to  that  effect,  who  shall  within  three  days  after  such  notifica- 
tion himself  select  and  appoint  a  chairman. 

5.  Said  board  of  inquiry  shall  have  power  to  summon  the  parties  to 
the  dispute  to  appear  before  it,  and  in  its  discretion  may  talk  with  each 
of  the  parties  separately  and  privately  in  the  hope  of  finding  common 
ground  for  agreement,  and  shall  have  such  other  powers  in  the  sum- 
moning and  examining  of  witnesses,  books,  and  documents  as  are  vested 
in  the  superior  courts  of  the  state  in  the  trial  of  civil  cases.    The  mem- 
bers of  the  board  must,  before  proceeding  to  the  examination  of  said 
books  or  documents,  make  oath  that  any  information  gained  from  said 
books  or  documents  shall  be  confidential  and  shall  not  be  used  for  any 
purpose  other  than  the  inquiry.    The  board  shall  endeavor  to  effect  a  set- 
tlement of  the  differences  between  the  parties,  and  if  successful,  shall 
in  writing  report  the  terms  of  such  settlement  to  the  labor  commissioner. 
Failing  to  effect  such  settlement,  the  board  shall  draw  up  a  findings  or 
report  setting  forth  what,  in  the  light  of  the  evidence  adduced,  would  in 
its  opinion  be  a  fair  and  equitable  basis  of  settlement  of  all  the  matters 
in  dispute. 

6.  A  certified  copy  of  the  findings  of  the  majority  of  the  board, 
together  with  a  certified  copy  of  the  minority  report,  should  there  be  one, 
provided  that  the  minority  report  is  signed  within  forty-eight  hours 
after  the  majority  report  is  signed,  shall  be  delivered  to  the  state  labor 
commissioner,  who  in  turn  shall  immediately  deliver  copies  thereof  to 
each  of  the  parties  to  the  dispute. 


CONCLUSIONS  AND  RECOMMENDATIONS.  155 

7.  Such  findings  shall  not  be  binding  on  either  party  unless  signed  by 
both  parties  or  by  their  representatives,  or  the  award  may  be  used  as  a 
basis  for  an  agreement  and  may  contain  such  penalties  for  violation  by 
either  party  as  may  be  mutually  agreed  upon.    In  the  event  of  a  settle- 
ment being  reached  between  the  parties  the  terms  thereof  shall  not  be 
made  public  if  either  party  objects  to  such  publication. 

8.  In  the  event  of  the  employers  declaring  a  lockout  before  complying 
with  the  foregoing  provisions,  or  prior  to  the  receipt  of  the  findings  of 
the  board  of   inquiry  transmitted  by  the  labor   commissioner,   said 
employers  shall  be  liable  to  a  fine  of  $25  for  each  employee  locked  out 
for  each  day  during  which  said  lockout  continues,  said  fine  in  no  event  to 
be  less  than  $1,000.    Said  fine  shall  become  a  lien  against  the  property 
of  said  employers  and  shall  be  collectible  as  are  other  court  judgments. 

9.  In  the  event  of  workmen  employed  by  public  utility  corporations, 
or  by  corporations  or  others  doing  public  or  contract  work  for  cities,  or 
counties,  or  for  the  State,  going  out  on  strike  without  complying  with 
the  foregoing  provisions  or  prior  to  the  receipt  of  the  findings  of  the 
board  of  inquiry  transmitted  by  the  labor  commissioner,  said  workmen 
shall  be  liable  to  a  fine  of  $1.000.    In  the  event  of  said  workmen  having 
no  common  funds,  then,  and  in  that  event,  in  lieu  of  the  foregoing  pen- 
alty, every  workman  going  out  on  strike  shall  be  liable  to  a  penalty  of  $25, 
said  fine  to  be  a  lien  against  the  property  or  the  wages  of  said  workman 
anywhere  within  the  State  at  any  time  within  twelve  months  and  shall 
be  collectible  as  are  other  court  judgments.    Violations  of  the  foregoing 
provisions  to  be  dealt  with  summarily  by  the  superior  court. 

10.  Attorneys  or  any  other  counsel  or  advocates  are  to  be  barred  from 
taking  part  in  the  proceedings  before  the  board  of  inquiry. 

11.  The  inquiry  may,  in  the  discretion  of  the  board,  be  held  in  public. 

12.  At  the  request  of  either  party  to  the  dispute,  the  board  may  be 
reconvened  at  any  time  during  the  life  of  the  agreement  to  which  there 
has  been  mutual  assent,  to  interpret  the  meaning  of  any  disputed  point 
in  said  agreement. 

13.  It  shall  be  unlawful  to  strike  or  to  lockout  until  seven  days  after 
the  board  award  and  the  objections  thereto  of  either  party  have  been 
filed  with  the  labor  commissioner.     In  the  event  of  a  strike  or  a  lock- 
out taking  place  after  said  seven  days  the  labor  commissioner  shall  on 
demand  furnish  to  the  press  and  to  others  copies  of  the  said  findings. 


156  REPORT  OF  SPECIAL  LABOR  COMMISSIONER. 

I  herewith  give  a  statement  of  reasons  which  should  appeal  to  capital, 
to  labor,  and  to  the  general  public,  for  supporting  the  creation  of  the 
proposed  board  of  public  inquiry. 

REASONS    WHY    EMPLOYERS    SHOULD    FAVOR   THE    PROPOSED    BOARD    OF 

PUBLIC  INQUIRY  ACT. 

1.  It  will  restrain  the  unfair  among  labor  men  from  making  unfair 
demands. 

2.  It  will  tend  to  prevent  labor  from  resorting  to  force  to  secure 
unreasonable  demands,  where  labor  is  unwisely  led. 

3.  It  will  ward  off  the  tendency  to  establish  compulsory  arbitration, 
which  is  likely  to  follow  if  no  other  means  of  relief  are  afforded  the 
public  to  protect  itself  against  the  loss  caused  it  by  what  are  often 
reckless  and  needless  strikes  and  lockouts  in  connection  with  public 
utilities.     Compulsory  arbitration  would  mean  that  a  court  would  fix 
for  the  employer  wages  and  conditions  of  labor. 

4.  It  will  tend  to  ensure  continuous  service  with  all  that  this  means 
in  respect  to  contracts. 

5.  It  will  tend  to  reveal  to  the  owners  the  efficiency  or  inefficiency  of 
company  officials. 

6.  It  will  tend  to  avert  all  the  evils  of  a  strike. 

REASONS   WHY   LABOR   SHOULD    FAVOR   THE    PROPOSED    BOARD    OF 

PUBLIC  INQUIRY. 

1.  By  diminishing  strikes  and  lockouts  it  will  prevent  needless  waste 
of  the  workers'  time,  money  and  energy,  and  tend  to  obtain  justice  for 
labor  without  loss  of  income. 

2.  It  will  gain  for  labor  intelligent  public  sympathy,  by  affording  it 
an  opportunity  to  present  its  grievances  before  a  public  tribunal  whose 
object  it  is  to  get  at  the  facts. 

3.  It  will  afford  labor  the  opportunity  to  make  good  its  oft  repeated 
claim  that  because  of  the  uniform  reasonableness  and  justice  of  its 
demands  it  courts  public  investigation. 

4.  It  will  tend  to  prevent  prejudgment  of  the  merits  of  labor  disputes 
on  the  part  of  an  interested  and  possibly  hostile  press. 

5.  It  will  compel  unfair  or  unwilling  employers  who  usually  take 
the  position  that  they  have  nothing  to  arbitrate,  to  get  together  with 
and  to  meet  their  men,  and  will  force  them  to  talk  about  the  merits  of 
the  dispute  and  to  listen  to  the  claims  of  the  other  side. 

6.  It  will  tend  to  prevent  unfair  or  unreasonable  employers  from  act- 
ing in  a  way  which  must  of  necessity  mean  suffering  and  loss  to  other 
people  who  are  not  to  blame. 


CONCLUSIONS  AND   RECOMMENDATIONS.  157 

7.  When  an  investigation  is  made,  it  will  not  be  possible  to  keep 
back  anything  that  is  likely  to  prove  helpful  to  the  cause  of  labor. 

8.  The  many  little  things  that  sometimes  crop  up  and  cause  serious 
trouble,  b^  an  impartial  investigation,  are  likely  to  be  adjusted  and 
settled. 

9.  Organized  labor  stands  committed  to  the  doctrine  that  it  does 
not  want  to  strike  in  order  to  enforce  its  demands,  if  the  consideration 
of  them  can  be  attained  without  recourse  to  that  drastic  remedy.     A 
board  of  inquiry  will  afford  the  remedy. 

10.  Organized  labor  is  not  blind  to  the  fact  that  in  every  great  indus- 
trial struggle,  in  connection  especially  with  public  utilities,  the  public 
has  a  large  interest  as  well  in  the  result  as  in  the  means  adopted  to 
reach  that  result.    The  board  of  inquiry  would  assure  a  hearing  under 
the  fairest  possible  conditions  and  bring  out  the  facts. 

11.  The  creation  of  a  public  board  of  inquiry  is  calculated  to  postpone 
hasty  action  in  the  direction  of  strikes  and  lockouts  and  will  tend  to 
the  settlement  of  disputes  as  the  result  of  reason  rather  than  as  the 
result  of  passion  or  feeling. 

12.  It  withal  will  not  take  away  the  final  right  to  strike. 

REASONS  WHY  THE  GENERAL  PUBLIC  SHOULD  FAVOR  THE  PROPOSED  BOARD 

OF  INQUIRY  ACT. 

1.  In  all  great  strikes,  especially  in  connection  with  public  utilities, 
the  public  has  more  at  stake  than  both  the  disputants  combined. 

The  board  of  inquiry  will  represent  the  public  equally  with  the  other 
parties  in  interest,  which  will  thus  be  given  the  voice  in  the  matter  to 
which  it  is  entitled. 

2.  It  will  make  for  reason  and  equity,  for  law  and  order  taking  the 
place  of  heat  and  passion,  disorder  and  violence  in  the  settlement  of 
labor  disputes. 

3.  It  will  make  for  labor  disputes  being  peacefully  settled  before  a 
tribunal  without  interruption  to  public  service. 

4.  In  the  event  of  either  party  to  a  labor  dispute  refusing  to  abide 
by  the  findings  of  the  board  of  inquiry,  the  publication  of  such  findings 
will  present  the  facts  and  enable  the  public  intelligently  to  give  its  sup- 
port to  the  party  having  right  on  its  side. 

5.  It  will  tend  to  reduce  to  a  minimum  strikes  and  lockouts  with 
their  consequent  tremendous  loss  and  injury  to  the  public. 

I  have  the  honor  to  subscribe  myself, 
Respectfully  yours, 

HARRIS  WEINSTOCK, 

Special  Labor  Commissioner. 


